Japan's Orix to buy US$980m stake in India's Greenko Energy

[TOKYO] Orix has agreed to buy a roughly 20 per cent stake in Indian renewable energy developer Greenko Energy Holdings for US$980 million, the Japanese conglomerate's biggest investment in the sector overseas.

Under the deal terms, the Tokyo-based company will acquire new shares along with existing stock from Greenko founders. It will transfer its entire wind power generation business in India to Greenko, Orix said in a statement Friday.

"India is a big and attractive market - power demand is growing," Hidetake Takahashi, an executive officer at Orix, said in an interview.

Currently, Singapore's GIC holds 65.8 per cent of Greenko, Abu Dhabi Investment Authority has a 16.5 per cent stake and the remainder is held by its founders. The Economic Times reported the deal earlier Friday.

Bloomberg News reported in April that Chinese state-backed investment fund CNIC was considering buying about a 10 per cent stake in Greenko Group, which was seeking to raise around US$800 million by introducing a long-term investor.

Orix is a major renewable energy developer in Japan, and Mr Takahashi said the company aims to build up assets overseas as well.

"In developing markets, we plan to take a minority stake and team up with local and other partners," he said. "In developed markets, we aim for a majority stake."

Mr Takahashi said the company is looking at several renewable energy developers in Europe as potential acquisition targets, with a deal size of about US$500 million. "We can develop from scratch by ourself in Japan. Overseas, we are trying to boost business through M&A," he said.

BLOOMBERG