IndiGrid, the Indian power sector's first infrastructure trust (InvIT), has acquired a 100% stake in two solar assets with a combined capacity of 100 MW from Fotowatio Renewable Ventures (FRV), a Madrid-based developer, at an industry value of Rs 6.6 billion.
In December 2020, IndiGrid had signed a securities purchase contract to get the two solar projects of 50 MW capacity each from FRV Solar Holdings Limited and FRV. To finance the 100 MW solar projects, FVR raised $29 million in non-convertible debentures from the International Finance Corporation (IFC).
PriceWater Coopers, Cyril Amarchand and Mangaldas, and Mahindra Teqo advised IndiGrid on this acquisition. Greenstone Advisors served as the sell-side advisor on the transaction of FRV.
IndiGrid’s purchase of its first solar asset is the first renewable energy acquisition by any InvIT in India.
The financing of the acquisition would be via a combination of debt, internal accruals, and current rights issues. Following the acquisition, IndiGrid’s net debt or assets under administration is nearly 58%, giving enough headroom for growth against the 70% leverage threshold.
The portfolio of InvIT’s assets consists of 14 diversified power projects, including 40 transmission lines (7,570 km), 11 substations (13,550 MVA capacity), and 100 MW of solar projects over 18 states and one union territory (UT).
The acquired 100 MW solar projects are fully working and established in the high radiation region at the 400 MW Ananthapuramu Solar Park in Andhra Pradesh for a 25-year contractual time at a fixed tariff. The power purchase agreement (PPA) for both assets is now in a position with the Solar Energy Corporation of India (SECI).
The projects have been in the working position for more than two years. This acquisition follows IndiGrid’s plan to get solar projects with long-term PPAs, an operational track record, and financially strong counterparties, off-takers like NTPC and SECI.
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