Sembcorp Energy India will become a wholly-owned subsidiary of the parent, On completion of this transaction.
According to the company, the proposed acquisition will allow Sembcorp to have the flexibility as a sole owner to evaluate and pursue a full range of growth opportunities in the renewables segment.
December 05, 2019. By Hemant Arora
Gayatri Projects is in the process of selling its 5.95% stake in Sembcorp Energy India (SEIL) to Singapore-headquartered Sembcorp Industries for Rs 406 crore, the two companies said on Wednesday.
Sembcorp Energy India will become a wholly owned subsidiary of the parent, On completion of this transaction.
According to the company, the proposed acquisition will allow Sembcorp to have the flexibility as sole owner to evaluate and pursue a full range of growth opportunities in the renewables segment, while at the same time seeking the right equity window to list its India business or to pursue other capital recycling options.The debt-laden Gayatri Projects said, “The proceeds of the stake sale will be utilized for reduction of the debt, general corporate purposes and working capital”, in a separate statement.
The proposed acquisition is expected to be completed by the end of the year, subject to the satisfaction of certain conditions precedent, including shareholders’ approval of Gayatri Projects.
There is also potential future earn-outs for Gayatri Projects on achievement of certain milestones by SEIL, according to the deal.
Sembcorp said it will fund the deal through a mix of internal funds and borrowings.
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