The Aditya Birla Group partners with The Abraaj Group to invest in Solar Power in India

The Aditya Birla Group, a US$ 41 billion multinational conglomerate, has today announced a partnership with The Abraaj Group ("Abraaj"), a leading investor operating in global growth markets, to build a large scale renewable energy platform focused on developing utilityscale solar power plants in India. The Aditya Birla Group will invest in the platform through Aditya Birla Nuvo Limited ("ABNL") and Abraaj will invest through one of its affiliates.

ABNL has entered into a definitive Share Subscription and Shareholders Agreement (SSA) with an affiliate of Abraaj. In accordance with the SSA, subject to the customary closing conditions and subject to the requisite approvals, ABNL and the Abraaj affiliate will hold 51% and 49% of the paid up share capital respectively, in Aditya Birla Renewables Limited, currently a wholly owned subsidiary of ABNL.

Aditya Birla Renewables Limited, the solar power platform, will bid for projects tendered at national and state auctions, with the intent to develop and operate utility-scale solar power plants that can provide clean and cost-effective electricity to the national grids across several key states in India.

The partnership comes at an opportune time in the growth of the Indian renewable energy sector. The demand for power in India is rising as a result of the country's growing population, rapid urbanization and increasing economic activities. At the same time, the Indian government has created favorable regulatory policies to foster the use of renewable energy, including setting an explicit target to achieve 100 GW of solar power capacity by 2022 compared to the current installed capacity of approximately 4 GW. Together, these factors create a compelling investment opportunity for the private sector, which can help meet this significant demand for renewable energy.

Commenting on the partnership, Dev Bhattacharya, Business Head - Group Corporate Strategy, Solar Power & E-Commerce, Aditya Birla Group, said, "The Aditya Birla Group supports the Government of India's initiative for a greater share of renewables in the energy mix, essential for sustained economic and industrial growth. This cooperation will give a fillip to the Aditya Birla Group's renewable energy initiatives and contribute to reducing the carbon footprint of India as a whole."

Sev Vettivetpillai, Partner and Global Head of Abraaj's Thematic Funds Business, said, "The gap in energy infrastructure in growth markets translates into a long-term and sustainable investment opportunity. Renewable energy is set for explosive growth, thanks to technological advances, favorable policies and pricing structures, that make it a competitive alternative to conventional power generation. At Abraaj, we see significant opportunity in India, one of the world's biggest energy consumption markets. We look forward to working closely with the Aditya Birla Group to provide clean energy to Indian businesses, communities and consumers."

Mustafa Abdel-Wadood, Partner and Global Head of Abraaj's Regional Funds Business, added, "The renewable energy sector in India offers vast potential for growth and can play a transformative role in reducing dependency on fossil fuels and enhancing India's long-term energy security. We are delighted to partner in this rapidly growing sector with one of India's leading entrepreneurial groups and, together, bring our capital and expertise to bear in creating a landmark investment that can address the demands for clean energy infrastructure in the country."

The Abraaj Group has comprehensive investment experience across the energy value chain and has invested c. US$ 1 billion in 10 investments in global growth markets.

The Aditya Birla Group was advised on the transaction by Greenstone Energy Advisors

Shares of ADITYA BIRLA NUVO LTD. was last trading in BSE at Rs.2206.2 as compared to the previous close of Rs. 2222.45. The total number of shares traded during the day was 14778 in over 1569 trades.

The stock hit an intraday high of Rs. 2250 and intraday low of 2177.95. The net turnover during the day was Rs. 32738924.

Source : Equity Bulls

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