Renewable energy development company SunEdison has decided to sell 425 MW solar power capacity in India to TerraForm Global, for $231 million.
“This transaction provides higher yields replacing lower-yielding IPO projects that were intended to be acquired through M&A and is consistent with our strategy to focus on organic growth provided by our sponsor,” said Brian Wuebbels, chief executive officer of TerraForm Global.
SunEdison operates Indian solar plants with about 450 MW of capacity, has further capacity of 800 MW under development and recently won a tender for a 500 MW plant in Andhra Pradesh.
The divestment plan is an attempt by SunEdison to monetize some assets to raise capital. SunEdison posted a huge quarterly loss in the recent quarter.
The development is unlikely to lead to a complete retreat from India. India is targeting 100 gigawatts of solar power by 2022 — about 33 times today’s level.
SunEdison’s plans to sell a part of its capacity is aimed at giving funding support to the parent and show its shareholders that it has been able to create some value in India, Reuters reported.
This month, SunEdison bagged an auction for a 500 megawatt project in the southern state of Andhra Pradesh, offering to supply power at a record low tariff of 4.63 rupees ($0.0706) per kilowatt-hour.
SunEdison shakes up top team
Meanwhile, SunEdison has appointed Emmanuel T Hernandez, current chairman, as executive chairman. He will work with Ahmad R Chatila, CEO, and SunEdison management team to to improve the alignment and effectiveness of its operating structure, drive operational efficiency and focus on its organic development opportunities.
Peter Blackmore has stepped down from the Board and will join TerraForm Power and TerraForm Global as chairman of the Board of Directors at both companies. Steven Tesoriere, who has separately resigned from the Board of Directors for TerraForm Power and TerraForm Global, will remain on the SunEdison Board.
Brian Wuebbels, chief financial officer, will assume the additional roles of chief executive officer of TerraForm Power and TerraForm Global. Wuebbels will succeed Carlos Domenech, who is leaving TerraForm Power and TerraForm Global as well as SunEdison.
Meanwhile, SunEdison has signed 20-year power purchase agreements with Los Angeles County in a deal that will see nine government facilities powered with 6.2 megawatts DC of solar energy.
SunEdison will build solar parking canopies at many of the locations. The systems are expected to generate energy each year to power more than 1,400 Californian homes. Over the 20-year period, the systems will reduce carbon dioxide emissions by more than 114 million pounds.
Rajani Baburajan
editor@greentechlead.com