Business strategy

Reliance New Energy Solar To Acquire 40% Of Sterling & Wilson Solar, Second Big Deal In A Day

Reliance New Energy Solar Ltd (RNESL), a unit of Reliance Industries Ltd (RIL), on Sunday said it will acquire 40 per cent of Sterling and Wilson Solar Ltd (SWSL). This transaction is another step towards Reliance Industries’ mega new green energy initiative to put India as a clean energy manufacturing hub on the global map. Earlier in the day, Reliance Industries acquired Norway-headquartered solar module maker REC Solar Holdings for an enterprise value of US$ 771 million from China National Bluestar.

Speaking about the acquisition, Reliance Industries chairman and managing director Mukesh Ambani said, “We welcome Sterling and Wilson Solar Ltd as a strategic partner towards building our New Energy platform. Sterling and Wilson Solar Ltd, with its engineering talent, deep domain knowledge, global presence, and experience of executing some of the most complex projects globally, will become an important part of our solar value chain. This will enable us to deliver our comprehensive, end-to-end ecosystem leading to cost-efficient green energy for Indian consumers.”

Reliance Industries will acquire 40 per cent stake in Sterling and Wilson Solar through a series of primary investment, secondary purchase and open offer, the oil-to-telecom conglomerate said in a statement.

Reliance New Energy Solar Ltd has bought 15.46 per cent stake or 2.93 crore equity shares in Sterling & Wilson Solar at a price of Rs 375.0 per share. Additionally it has also acquired 1.84 crore equity shares or 9.70 per cent share from Shapoorji Pallonji and Company Private Ltd at the same price. The oil-to-retail conglomerate will also trigger an open offer to acquire additional 25.9 per cent of the company, according SEBI Regulations. If it is successful, RNESL will acquire 40 per cent stake involving a total pay out of Rs 3,630 crore.

Sterling and Wilson is one of the leading and highly reputed international Engineering, procurement, and construction and Operations and Maintenance (O&M) service providers in the renewable sector. It provides a comprehensive range of solar energy turnkey solutions including design, procurement, construction, project management and operations and management. In its over 5-decade long journey, Sterling and Wilson has executed 11-plus GW of solar turnkey projects. The market capitalisation of Sterling and Wilson Solar as on Friday was Rs 6,972.45 crore.

Shapoor Mistry, chairman of Shapoorji Pallonji & Co. Pvt. Ltd, said: “We are happy to welcome Reliance in Sterling and Wilson Solar Ltd. Through the decades, spanning three generations, the Shapoorji Pallonji group has helped Sterling and Wilson become a global leader in providing turnkey solutions in the energy value chain. Sterling and Wilson Solar Ltd is now well-poised to make a valuable contribution, as the world transitions to a low-carbon economy. I believe this partnership is beneficial to all stakeholders and will greatly contribute to making India a leading green energy powerhouse.”

“Reliance, with its integrated new energy vision, and a commitment to put India on the global green energy map, provides us a great opportunity to further establish Sterling and Wilson Solar Ltd as the leading EPC solutions provider globally. I am sure this partnership will give SWSL new energy and excitement, and we look forward to becoming part of creating history,” said Khurshed Daruvala, chairman of Sterling and Wilson Solar Ltd, who will continue in the role.

Reliance said the partnership with Sterling and Wilson Solar Ltd will provide it access to world-class talent, engineering and project management skills and complement Reliance’s proven strengths in digital technology, engineering, and procurement and project execution – all key ingredients required to deliver high quality, cost efficient and time-bound implementation of giga-scale green energy capacity, in India and across the world. “Combined with Reliance’s announced plans to set up four state of art giga factories in Jamnagar, Gujarat, the partnership offers fully integrated product with unrivaled engineering capabilities,” said the conglomerate.

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