Fortum Divests 500 MW Indian Solar Assets To Investor Actis

Actis, the global emerging markets investment firm focused on the private equity, energy, infrastructure, and real estate asset classes is acquiring 500 MW assets of Finnish firm Fortum in India. The news was first reported in business daily, Economic Times. Actis has a growing portfolio of investments across Asia, Africa, and Latin America and US$12 billion in assets under management. In India, Fortum has been active in the solar development space, besides vehicle charging points now, and power plant services  that include selling pollution control solutions for NOx reduction.

Under the deal, Fortum will reportedly be divesting its 250-MW Pavagada II and the 250-MW Rajasthan solar power plants in India, said a company statement. With these divestments, Fortum will cut down its India solar assets portfolio by more than half, to less than 250 MW in total. The firm has no other project in the 150 MW plus range with it now.

The total consideration for the deal  has been reported to be approximately EUR 280 million (Rs 2480 crores).

Since starting in 2013, Fortum has built up a portfolio of 680 MW of solar power in India. the partnership with Actis, which envisages the two jointly looking at more solar assets for acquisition, sees a role for Fortum as the technical partner even as Actis funds transactions.

The Built Own and Transfer (BOT) model is not new to the sector, as many developers have been keen to exit their investments after 3 years or more to reinvest in fresh assets. Until recently, Adani Green Energy has been the firm that has been picking up assets at a furious pace.