CPPIB may offer to buy out ReNew minority shareholders, Energy News, ET EnergyWorld

CPPIB may offer to buy out ReNew minority shareholders

Canada’s biggest pension fund manager CPP Investments (CPPIB) has initiated preliminary discussions with investment banks to explore the possibility of launching a tender offer to acquire the minority shareholders of Nasdaq listed renewable energy company ReNew Energy Global, which operates one of India’s biggest renewable energy platform – ReNew Power, said a person in the know.

At 8.00 PM on Friday, ReNew’s shares were trading at $4.96, up 13.1 per cent, valuing the company at $1.92 billion.

CPPIB, which has already been consolidating its shareholding in the Nasdaq listed company, through the tender offer is planning to take the company private, they added.

Earlier this month, CPPIB bought a 14 per cent stake from Goldman Sachs for a sum of $268 million, increasing its stake in the company to 52 per cent.

At current market price, CPPIB will have to spend close to $900 million to acquire all the remaining shares of the firm. CPPIB has so far spent a little over $1 billion in total to acquire shares of the company.

The discussions are at a preliminary stage, the person cited above said. “This will not happen immediately. Launching a tender offer will take time,” he added.

“What CPPIB is trying to do is similar to GIC’s playbook with Greenko. The Singaporean sovereign fund consolidated the shareholding in the company, kept it private and has continued to invest large sums to back the founders and grow the platform into one of India’s largest renewable companies. For a large and patient capital investor such as CPPIB, who wants to invest large sums in Indian renewable energy, it’s better to do it through a private vehicle in which it owns a majority stake rather than a publicly listed company,” he said.

“We do not comment on speculative stories,” said a spokesperson for the CPP Investments. An email sent to ReNew Power did not elicit a response till press time.