Thai energy giant PTT Group I $ 500 million Renew buy-in

The largest shareholder GS can halve its stake; Existing investors remain CPPIB back up option

Mumbai (Natural Energy News): Thailand's state-owned energy company PTT Group, one of India's clean energy companies, underscoring the growing interests of Southeast Asian oil and gas majors, is also its largest group, the Goldman Sachs Group Is talking with Green Enterprises back in the field.

The transaction may have sold at least half of Wall Street Investment Bank's stake in the company, but is expected to eventually crystallize as talks progress in the coming weeks, with much-reported growth.

PTT is currently conducting a detailed due diligence exercise and has indicated that they are open to investing $ 500 million in a valuation of approximately $ 2.2 billion in the company, which the company had just bought two years ago. One of the sources said that PTT may also end up being the largest shareholder in the company, following transactions that would see some primary capital infusion in the company. EY is advising the Thai company.

Goldman Sachs, Renew's largest shareholder, with a 48% stake, has been looking to cut its stake and unlock value for some time as the company completes plans for its IPO at a $ 4 billion valuation in mid-2018 Was forced. Goldman helped Sumant Sinha (first-generation entrepreneur) to develop a green energy platform with an allegiance of $ 200 million in 2011.

Goldman  Since then many other high profile investors has come on board. CPPIB and Abu Dhabi's Sovereign Wealth Fund Abu Dhabi Investment Authority is 16% each; Japan's head of gas and utilities holds an 8% stake in JERA, while other smaller financial investors such as the Global Environment Fund control 3% of the bank. Sinha and his senior employees own the rest.

Goldman, ReNew declined to comment. Mails sent to PTT did not receive a response until press time.

An official who was involved in a discussion said that "It is being examined in Hong Kong and London by the team of Goldman. They have been talking for months with existing and new to monetize their investments since the original fund's life was over. With conventional oil and gas corporations modifying into environmentally friendly involvement chances for their ESG submission, you will see additional of this trend."

Malaysia's state-owned Petronas has had active negotiations with Tata Power to invest in its Clean Energy Investment Trust (Invit), ET reported on 5 June.

Earlier sources had cited that Goldman had tried to tie up with Brookfield earlier in the year, but Brookfield's offer was unsuccessful due to Goldman not agreeing. Subsequently, CPPIB was approached to purchase an additional 24% stake. Paused discussions, for now, may revive in the future. The company has also found that raising primary capital is strategically difficult because it will set a new norm, people know. CPPIB made its investment at a valuation of $ 2.8 billion.

There is no assurance that these conversations will lead to an agreement, instructed the officials referred above.

ReNew is among the top two independent power producers in the country, with approximately 10 GW of operations and geographically in pipeline wind and solar capacity, with no single state accounting for more than 25% of the total portfolio. Most of the assets - 96% of the group's capacity - are power purchase agreements (PPAs) with tenures of about 20-25 years.

However, industry players say that the company is facing a total debt of Rs 32,487 crore after taking huge debt through an acquisition before the IPO. Ostro's acquisition in 2018 for Rs 10, 800 crore ($ 1.66 billion) was the largest in the region. But with a declined IPO, new capital allotment came to be tough. Moreover, close to 2GigaWatt of its projects located in states like Telangana, Tamil Nadu, Rajasthan, Andhra Pradesh, Maharashtra is handling delays in expenditures from state electricity boards or locked in action over the sanctity of agreements. This has forced the company to sell the property, seeking a partnership to destroy its balance sheet.

 In January, through a dollar bond issue, it raised $ 450 million to refinance existing borrowings and fund future capital expenditures. However, Fitch analysts believe that with readily available cash and repayment obligations of approximately Rs 4440 crore ($ 600 million) and only 2700 cores over the next 12 months, the company has adequate liquidity cover.

Analyst Girish Madan wrote last month, "A decrease in higher PLFs or increases in receivables could lead to a decrease in the liquidity buffer, as we expect the company to generate negative free cash flow for the medium term in addition to current capacity. " "We expect slow biological growth." The company's FY2020 financials are not yet published, but it is estimated that ReNew will be Rs 5078.4 crore in gross revenue and EBITDA of Rs 4398.4 crore.

Renewed PTT group, petrochemical, fuel and coffee with business interests in oil and gas exploration, which has gone up for renewal after the clean energy arm Global Power Synergy Public Company (GPSPC), spent $ 4.2 billion last year on electricity. Glow Energy Plc is buying power from Angie for gas and coal. GPSPC, which was listed separately in 2013 by merging several of PTT's power utility arms, and also purchased Brookfield Renewable Partners' Thailand-based solar power business for $ 100 million earlier this year.

It declared agendas to create a blockchain-based renewable demand, which, along with an energy blockchain non-profit, was planned to inaugurate this May.

Post a Comment