Total has acquired a 20 per cent stake in Adani Green Energy in a $2.5bn deal that deepens the French energy major’s renewables push and its relationship with Indian tycoon Gautam Adani’s empire.
The investment announced on Monday was at a nearly 40 per cent discount based on Adani Green’s Rs1.5tn ($20bn) market capitalisation. It also grants the French group a 50 per cent share in a 2.35-gigawatt portfolio of solar assets and gives it a seat on the company’s board.
International investors are pushing into India’s renewable projects because they offer higher returns due to rising demand, said Tim Buckley, analyst at the Institute for Energy Economics and Financial Analysis in Australia.
Many of the renewables projects, including some of the Adani Group’s, benefit from nearly 25-year power purchase agreements with national and regional electricity distributors at a fixed rate, he added.
[Stephanie Findlay and Anjli Raval]