After REC, RIL picks up player EPC Sterling & Wilson Solar from SP Group
Shapoorji Pallonji & Co. Pvt. Ltd (SPCPL) and Khurshed Yazdi Daruvala, promoter-shareholders of Sterling and Wilson Solar, hold a total of 69.36% of the company, with the public holding the remainder. The promoters raised Rs 2,850 crore from the public through an IPO in 2019, but subsequently failed to repay the company’s loans a year later, despite being pledged in the prospectus. This created a future among shareholders who demanded an exit from their investments citing breach of trust.
Reliance New Energy Solar Ltd (RNEL), a wholly owned branch of Reliance Industries, will receive new shares of Sterling and Wilson as a preferential grant of 2.93 crore shares at Rs 375 / share, representing 15.46 % of the company’s extended equity base. Another 9.70% of the company will be acquired by RNSL from Shapoorji Pallonji & Co. Pvt. Ltd at the same price. This will also trigger an open offer for an additional 25.7% of the company in accordance with Indian takeover regulations and, if fully successful, RNESL will hold 40% of the capital, which involves a total payment of Rs 3,630. crore.
Sterling and Wilson Solar’s market cap on Friday was Rs 6,972.45 crore.
The company recorded a consolidated net loss of Rs 76.02 crore against a net profit of Rs 17.22 crore in the quarter ended June 30, 2021.
The stock, however, has risen 60% in the past 3 months in anticipation of a deal. On September 29 of this year, SP Group and SWSL repaid an unpaid debt of Rs. 2,563 crore, further paving the way for a transaction.
ET in its September 8 edition was the first to report that the promoters of Sterling and Wilson are considering divesting their stake and may even relinquish control and were in talks with players like Adani Group,
, Brookfield among others.
Sterling and Wilson is one of the world’s leading EPC (engineering, procurement, construction) players. prospects forcing the Mistry family to sell family jewels like Eureka Forbes. In March, the KV Kamath committee appointed by the Reserve Bank of India approved a one-off restructuring plan for the 150-year-old SP group’s Rs 10,900 crore debt as part of Covid-19 relief. Sales are part of this exercise.
As of August 14, 2021, the company’s unfulfilled backlog stood at Rs 8,731 crore, which is executable over the next 12-15 month period.
With these two transactions, Reliance will become a major player in two crucial areas of renewable solar energy projects: solar cell manufacturing and EPC, at a time when Chinese manufacturers’ dominance is under attack. increased global surveillance. It also gives Reliance access to cutting-edge technology and global manufacturing capabilities, as well as a national base that will help the group build a solid foundation.
He also invested in American battery storage technology company Ambri Inc, along with Bill Gates and Paulson and Co.
The deals follow Ambani’s announcements of ambitious green energy plans with the establishment of the 5,000-acre Dhirubhai Ambani Green Energy Giga complex in Jamnagar at the company’s 44th annual general meeting in June. With an investment of $ 10 billion, the company plans four giga factories: an integrated solar photovoltaic plant, an advanced energy storage battery manufacturing unit, green hydrogen and a fuel cell installation.