Suzlon Energy to acquire 76% state in Renom Energy; deal valued at ₹660 crore in two parts

Suzlon Energy Ltd.'s Board of Directors have approved the 76 per cent acquisition of Renom Energy Services; the deal is to be valued at ₹660 crore in two segments, according to the company's Bombay Stock Exchange (BSE) filing on Tuesday, August 6.

“We hereby inform that the board of directors of Suzlon Energy Limited at its meeting held today, i.e., 6th August 2024 has, inter alia, approved the acquisition of 22,80,000 equity shares representing 76% of the equity share capital of Renom Energy Services Private Limited on a fully diluted basis, by the Company in multiple tranches,” said Suzlon in the exchange filing.

The first segment of the deal will be executed where Suzlon will acquire 51 per cent of Renom's shareholding for a sum of ₹400 crore, then in a time period of 18 months, the energy company will acquire 25 per cent more stake in Renom for a cost of ₹260 crore, according to the company's filing.

Renom Energy Services is the largest multi-brand renewable energy operations and maintenance service company with assets of 1,782 Megawatts (MW) in the wind segment, 148 MW in solar energy, and 572 MW in BOP under maintenance across the customer segments. The turnover of the company for the financial year ended 2024 was ₹213 crore, according to the company statement.

The closure of the transaction is subject to the completion of certain conditions specified, said the company.

“This strategic acquisition will help unlock Renom’s core potential and position it from a place of strength to become a leading Independent Service Provider (ISP) and custodian of multi-brand renewable energy assets,” said Suzlon. The deal will also provide Suzlon the opportunity to tap into the 32 Gigawatts (GW) of non-Suzlon wind energy assets in India, they said.

“With our in-house Suzlon Services Business focussed on Suzlon-make turbines and now with Renom’s focus on non-Suzlon Multi Brand Renewable Energy Assets, we are comprehensively positioned across the Indian Renewables OMS sector,” said JP Chalasani the Chief Executive Officer of Suzlon Group in the statement.

Suzlon Energy's shares closed 2.43 per cent lower at ₹66.26 after Tuesday's market session, compared to ₹67.91 in the previous market close. The acquisition announcement was released after the market hours.