Mukesh Ambani is set to snap up a 40 per cent stake in Sterling and Wilson Solar Ltd (SWSL) for Rs 2,845 crore -- an acquisition that will enhance its presence in the renewable energy space.
The transaction will see Reliance New Energy Solar Ltd (RNESL) becoming one of the promoters of the pure-play, end-to-end solar engineering, procurement, construction (EPC) solutions provider.
The subsidiary of Reliance Industries Ltd (RIL) will have the right to nominate two individuals on the board of SWSL.
The Mistry and the Khurshed Daruvala families will stay on as promoters of the company. Their combined holding currently stands at 69.36 per cent in SWSL.
This acquisition will be sealed through a multi-stage transaction. To begin with, SWSL will issue 2.93 crore preferential shares at a price of Rs 375 per share. After this issue, the current promoters of SWSL — Shapoorji Pallonji and Company Pvt Ltd and Daruvala — will sell 1.84 crore shares out of their holding at the same price. RNESL will also come out with an open offer to acquire around 26 per cent of SWSL’s equity at the price of Rs 375 per share.
Under the terms of the share purchase agreement, the two promoters of SWSL will sell additional shares to ensure that RNESL will have a 40 per cent stake in the company.
The deal price of Rs 375 per share is at a discount of 13.75 per cent to the closing price of the SWSL scrip at the BSE on Friday.
Second pact
This is the second major transaction that the cash-strapped Shapoorji Pallonji group has struck after the Rs 4,400 crore deal for Eureka Forbes that was reached with Advent International last month.
“We welcome SWSL as a strategic partner towards building our new energy platform. SWSL, with its engineering talent, deep domain knowledge, global presence, and experience of executing some of the most complex projects globally, will become an important part of our solar value chain. This will enable us to deliver our comprehensive, end-to-end ecosystem leading to cost-efficient green energy for Indian consumer,” Mukesh Ambani, Chairman of RIL said.
SWSL has executed more than 11GW of solar turnkey projects globally and has over five decades of engineering experience. It is known for international EPC (engineering, procurement & construction) and O&M (operations & maintenance) service provider in the renewables sector.
The company has a 3,000 strong team and presence across 24 countries.
Reliance said the partnership with SWSL will provide it access to world-class talent, engineering and project management skills and complement its proven strengths in digital technology, engineering, and procurement and project execution which are key ingredients to deliver high quality, cost-efficient and time-bound implementation of giga-scale green energy capacity, in India and across the world.
"Reliance, with its integrated new energy vision, and a commitment to put India on the global green energy map, provides us a great opportunity to further establish SWSL as the leading EPC solutions provider globally," SWSL chairman Daruvala said.
