Canada Pension Plan Investment Board (CPPIB) will invest close to USD 350m in Goldman Sachs-backed ReNew Power Ventures in the biggest renewable deal in India this year.
The 15% investment is split into two transactions, CPPIB, Canada’s biggest pension fund, said in a regulatory filing to the Competition Commission of India.
CPPIB will invest USD 200m in compulsorily convertible preference shares that will automatically convert into equity shares of ReNew at the stage of the initial public offering, the filing said.
In addition, CPPIB will buy 6.33% of ReNew’s shares from Asian Development Bank for about USD 150m. This values the company at USD 2.4bn. ADB first invested USD 50m in ReNew three years ago.
At this valuation, the USD 200m investment should fetch an 8.3% stake in ReNew for the pension fund.
CPPIB invests the funds not needed by the Canada Pension Plan to pay current benefits on behalf of 20m contributors and beneficiaries. It has been investing in India since 2010, in infrastructure, real estate and financial services, the filing said. It had USD 328bn in assets under management as of September.
Earlier this month, ReNew acquired three operational wind farms from Karm Chand Thapar Group for USD 153m.
As previously reported, Japan’s JERA bought a 10% stake ReNew Power for USD 200m in February, joining existing investors Abu Dhabi Investment Authority, ADB and Global Environment Fund along with Goldman Sachs, which has a 15.4% share.
ReNew Power has over 3.5GW of commissioned and under-construction clean energy capacity across 16 states in India, according to its website.
India is planning to award 100GW of solar and wind contracts by March 2020 to achieve its goal of 175GW of clean energy capacity by 2022.