Malaysian oil and gas company Petronas has offered to buy a 20 percent stake in NTPC’s green energy arm for Rs 38 billion ($460 million), Reuters reported, citing three sources. The offer values NTPC Green Energy Ltd (NGEL) at $2.3 billion.
According to the report, the bid was higher than the Rs.30 billion expected by NTPC. Last year, the country’s largest electricity producer, NTPC, solicited expressions of interest in NTPC Green Energy Ltd (NGEL).
An industry source and a banker told Reuters that Petronas had outbid other companies with an offer of Rs.27.52 per share. The report added that REC Ltd was the second highest bidder with an offer of Rs 15.47 per share. While Indraprastha Gas Ltd (IGL) placed an offer of Rs 6.67 per share.
The deal comes at a time when the country’s renewable energy industry is attracting more international investment. It is the first time that a state-owned company in India has offered a stake in a renewable energy subsidiary, the report added.
Citing data from the Department of Commerce, the report said the renewable energy sector is among the top five industries in the country to attract foreign investment this fiscal year.
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NTPC plans to use the proceeds from the sale to grow its non-fossil business. It plans to invest more than $30 billion over the next 10 years to increase the proportion of non-fossil energy in its portfolio. The company has committed to adding 60 gigawatts of renewable energy by 2032, with a total group capacity of 130 gigawatts by that date, the report said.
India has committed to sourcing 50 percent of its installed electricity capacity from non-fossil energy sources by 2030 and has set a goal of becoming net zero by 2070. By 2030, the country aims to generate 500 gigawatts of renewable energy. 30 percent of the country’s current installed capacity of 412 gigawatts comes from renewable energy sources such as wind, water and biomass.
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