Sembcorp Industries plans to acquire an India-based renewable energy company from Global Infrastructure Partners India for $474 million.
The target, Vector Green Energy, is described by Sembcorp as an independent power producer with renewable power generation assets spread across 13 Indian states.
The portfolio includes 495MW of solar capacity and 24MW of wind capacity in operation, with 64MW of solar projects under development.
Including Vector Green, Sembcorp’s gross renewables portfolio installed and under development in India will total 3GW, comprising 1GW of solar assets and 2GW of wind assets.
Wong Kim Yin, group president and CEO of Sembcorp Industries (picture) says the company "remains committed" to growing its renewables portfolio in India, one of the fastest growing renewables markets in the world.
"This acquisition is aligned with the group’s brown to green transformation strategy," he adds.
With the completion of this acquisition, Sembcorp's gross renewable energy capacity will increase to 8.5GW. It has a 2025 target of 10GW.
"This acquisition brings significant utility-scale solar capacity to our India business, which will complement our existing wind portfolio," says Vipul Tuli, Sembcorp's CEO of South Asia.
"It also broadens and deepens our renewable energy capabilities and presence across states in India, and positions us well for further green growth in the country," he adds.
Sembcorp plans to fund the acquisition, which is likely to close in 1Q 2023 via internal cash and external borrowings.
The company expects this acquisition to be accretive to earnings upon completion.
Sembcorp shares close Nov 11 at $3.04, up 0.66% for the day and up 51.24% year to date.