Suzlon to buy 76% stake in Renom to expand wind turbine O&M footprint

Indian wind turbine maker Suzlon Energy Ltd (BOM:532667) said on Tuesday it has agreed to acquire a 76% stake in operations and maintenance (O&M) company Renom Energy Services Private Limited in a two-tranche deal that will allow it break into the growing non-Suzlon turbine services market in India.

Indian business conglomerate Sanjay Ghodawat Group (SGG) arranged to sell the majority stake for a total of INR 6.60 billion (USD 78.6m/EUR 72m). The transaction will see Suzlon shell out INR 4 billion to acquire a 51% stake in the first tranche, and pay INR 2.6 billion within 18 months for the remaining 25% stake in the second tranche.

Renom, according to Suzlon, is India’s largest multi-brand renewable energy O&M services provider, boasting around 2,500 MW of assets under maintenance -- 1,782 MW of wind, 148 MW of solar and 572 in balance of plant.

The acquisition will strengthen Suzlon’s position in the Indian wind energy O&M market as it gains access to turbines from other brands.

Suzlon said that its in-house O&M team will focus on servicing the existing 15-GW Suzlon turbine fleet in India, while Renom will continue to cater to the non-Suzlon turbine services market, currently at 32 GW.

Following the acquisition, Renom will continue to operate as an independent board-managed service provider.

"With India's target to achieve 500 GW of renewable energy installations by 2030, we shall see a multitude of different technologies and wind turbines of various makes in the market going ahead,” said Girish Tanti, Suzlon Group’s Vice Chairman.

“Renom has emerged as a single largest player in this domain with great strength and potential to tap further into this market segment. This acquisition aligns with Suzlon Group's vision of leveraging growth while safeguarding our country's renewable energy assets, irrespective of their original make,” Tanti added.

(INR 10 = USD 0.119/EUR 0.109)

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