JSW Energy Completes the Acquisition of RE Portfolio of Mytrah Energy

JSW Neo Energy Limited ('JSW Neo'), a whollyowned subsidiary of JSW Energy Limited ('The Company'), in a two-step process has completed the acquisition of 1,753 MW of renewable energy assets from Mytrah Energy (India) Private Limited ('MEIPL').

- Acquisition of 15 SPVs and 13 ancillary SPVs having 1,449 MW of total installed renewable energy capacity. The said 28 subsidiaries of MEIPL have now become subsidiaries of JSW Neo and accordingly step-down subsidiaries of the Company.

- Infusion of Optionally Convertible Debentures (OCDs) with a right to convert into equity and has executed binding definitive Forward Sale Agreements for the balance 2 SPVs having renewable energy assets of 304 MW.

The Mytrah portfolio of 1,753 MW comprises of 1,331 MW of wind capacity and 422 MW (487 MWp DC) of solar capacity operating primarily in the southern, western and central parts of India. The assets have a proven operational track record and long-term PPA with an average remaining life of ~ 17 years.

The transaction values the Mytrah Energy portfolio at an Enterprise Valuation of approximately ₹10,150 Crores, after adjusting for net current assets and other adjustments under the SPAs (Share Purchase Agreements).

This is the largest acquisition made by JSW Energy since inception, and will leapfrog the current operational capacity by over 36% from 4,811 MW to 6,564 MW. Moreover, with about 2.9 GW of under-construction projects which are likely to be commissioned in phases over the next 12-18 months, JSW Energy is well ahead of its target to reach 10GW operating company by FY2025 with the share of renewables increasing to ~61%. Closure of this deal demonstrates the company's unique ability to swiftly acquire large, complex portfolios that can add significant value to its shareholders.

KPMG India Services LLP were the transaction advisor to the company, while Khaitan & Co. were the legal advisors and PricewaterhouseCoopers Services LLP carried out financial and tax due diligence.

Prashant Jain, Joint Managing Director and CEO of JSW Energy, said: "We are pleased to acquire the portfolio of Mytrah Energy, which is a landmark transaction and would be immensely value accretive to our shareholders from day one. This acquisition further strengthens and diversifies our operating footprint across various key resource rich states, increasing optionality to grow the portfolio further. We are confident to significantly improve the operating performance of the Mytrah portfolio by implementing a comprehensive asset optimisation and performance improvement plan by leveraging our operating and financing expertise. The acquisition would help the Company in advancing towards its capacity target of 10 GW by FY 2025, well ahead of time."

Pritesh Vinay, Director (Finance) and CFO of JSW Energy, said: "The completion of the Mytrah acquisition demonstrates our ability to execute and close complex transactions with an attractive financing package and consistently create value for all stakeholders. We have a comprehensive plan to optimise machine availability and generation profile with cost take outs to enhance EBITDA within the next 12-18 months. A compelling and benchmarked refinancing and debt sizing package which delivers about 200 bps savings in finance cost with elongation of the debt maturity profile, delivering significant value immediately upon acquisition, is already in place. Our strong track record, robust balance sheet and high cash returns profile is a key tailwind to pursue our growth ambitions both organically and inorganically."

The Company has set a target to reach 20 GW capacity by 2030 and near-term target of 10 GW by 2025. With the acquisition of Mytrah RE Assets the total locked-in capacity stands at 9.9 GW of which total renewable capacity stands at ~6.0 GW. JSW Energy has set an ambitious target for a 50% reduction in its carbon footprint by 2030 and achieving Carbon Neutrality by 2050 by transitioning towards renewable energy.

Shares of JSW Energy Limited was last trading in BSE at Rs. 236.70 as compared to the previous close of Rs. 222.20. The total number of shares traded during the day was 188058 in over 2904 trades.

The stock hit an intraday high of Rs. 239.80 and intraday low of 222.85. The net turnover during the day was Rs. 43583916.00.

Source : Equity Bulls

Keywords

JSWEnergy INE121E01018 JSWNeoEnergy Acquisition RenewableEnergyAssets MytrahEnergy