The Suzlon group, on Thursday, signed a binding agreement with private equity firm Centerbridge Partners LP, U.S., to sell 100 per cent stake in its wholly-owned subsidiary Senvion SE, for 1 billion euro (about Rs.7,200 crore). Suzlon will also get future earn out of up to an additional 50 million euro (Rs.360 crore). The 100 per cent stake sale of Senvion is in line with Suzlon’s strategy to reduce its debt, estimated at over Rs.16,000 crore and focus on the home market and high growth markets. The transaction is expected to close before March.
“The proceeds would be used for debt repayment thereby reducing interest cost and augment business growth. We will focus on high growth markets like India, the U.S. and other emerging economy markets,’’ Suzlon group Chairman Tulsi Tanti said.
Suzlon had acquired controlling stake in Senvion, formerly REpower, in 2007 and completed the 100 per cent acquisition of the German firm in 2011 with an estimated investment of over 1.5 billion Euros. The proposed sale is nearly 40 per cent lower than the cost of acquisition.
