Tata Power, the largest power utility in India, is poised to pay $1.45 billion for the renewable energy portfolio of Welspun Group, according to local media reports.
The India Times reported over the weekend that it had spoken with three people familiar with the matter, who confirmed that talks are in the final stages of negotiations and the hope among both parties is that a sale agreement could be signed within the next three weeks.
pv magazine has contacted by Tata Power and Welspun Group for comment on the matter.
Welspuns solar and wind portfolio is estimated to stand at around 1,152 MW of cumulative capacity, and Tata Powers offer is said to have trumped similar acquisition proposals from IDFC Private Equity and Fortum, the Finnish multinational that has pledged to invest more than $450 million of its own money into Indian solar projects.
According to the India Times, Tata Powers bid was some 15-20% higher than rival offers, with the utility keen to take on all operating assets as well as the pipeline of Welspun Group, which has some 685 MW of wind and solar in operation across eight Indian states, 200 MW to be commissioned by June, and a further 257 MW in the pipeline for October-November this year.
Tata Power Renewable Energy Limited (TPREL) was created in 2015 to operate the renewable arm of the utility. Its current portfolio stands at more than 1.6 GW of clean energy of which the bulk is hydro and wind, with just 60 MW of solar PV.
Fortum reaffirms Indian interest
In other media reports over the weekend, Finnish firm Fortum moved to reassure banks and investors spooked by the recent SunEdison bankruptcy that its intentions for the Indian solar market are robust and ambitious.
Speaking to Bloomberg, Fortum managing director Sanjay Aggarwal said that the firm is willing to take construction risks themselves, adding: "Were very clear we would bring in our funds."
Discontent has been building within India that Fortums record low bid in January accepted at 4.34 rupees/kWh to build 70 MW of solar capacity is too unrealistic, will never get built and is simply serving to harm the Indian solar sector.
However, in an effort to ward off doubters, Aggarwal has confirmed that Fortum is in a position to finance and construct the projects themselves, stating "we would go to the lender once we have commissioned the plant."
Bloomberg reports that Fortum plans to invest $455 million in Indian solar, and has the safety blanket of Nordic customers generation a sizable cash flow back home that helps support the firms overseas investment ventures.
"Fortums presence is very beneficial for solar in India as they can sustain low-growth with an eye on the long term," Anish De, partner at KPMG, told Bloomberg.