Mytrah Energy looking to divest stake; in talks with Canada’s Brookfield

Mytrah Energy India Pvt Ltd (MEIPL), an independent producer of renewable energy, is in advanced stages of talks for divestment of stake.

According to unconfirmed reports, Brookfield Asset Management Company Inc of Canada, an active investor in various sectors in India, is engaged in parleys with the company to invest in the latter’s assets valued at about $1.5 billion.

When contacted, a Mytrah Energy spokesperson said, “At this point, we have no comments.”

The Hyderabad-based company, which was earlier listed on the Alternative Investment Market (AIM) of the London Stock Exchange, got itself de-listed later. The company, which has a portfolio of about 2000 MW (2 giga watt) of wind and solar projects in the country (including those in pipeline) spread across several States, has been planning to significantly expand its portfolio.

However, the market conditions have delayed some of the projects.

Rating Negative Watch

India Ratings & Research recently put the company’s fund and non-fund limits on “Rating Negative Watch” even as it maintained that Mytrah’s business outlook was stable.

It had mentioned that the ratings were provisional and shall be confirmed upon the sanction and execution of the loan documents for some select credit facilities.

The Rating Negative Watch reflects possibility of delays in equity infusion in MEIPL compared with the timeline anticipated earlier. A delay in equity infusion could in turn lead to delay in the execution of under-construction capacities and in the replacement of bridge financing with equity.

The company’s management had earlier indicated that it expected to complete the equity infusion. The company’s move to raise fresh equity is aimed at replacing the bridge capital of $277 million (about ₹1,800 crore) raised from Piramal Enterprises Ltd in September 2017, as well as to fund the existing under-construction and committed projects.

While the company is engaged in discussions with investors for raising equity, it may even consider selling part of its completed portfolio. The focus of the company is on divesting stake, raising funds, paring debt and redeploying the funds in some of the new projects.

The company has also been considering an initial public offering, though it is yet to take a final call, sources close to the development indicated.

The renewable energy sector in the country has been witnessing consolidations and several major mergers and acquisitions, including Tata Power’s acquisition of Welspun’s portfolio and Greenko’s acquisition of Orange Renewables.

During recent interactions, the company management had outlined plans to expand its project portfolio. While it started as a wind energy focussed independent power producer, it diversified into solar projects later.

source@bussiness line