ReNew Power in talks to sell wind, solar assets to GAIL | Economic Times

New Delhi: ReNew Power is in talks to sell wind and solar assets to GAIL for ₹3,000 crore, according to people aware of the matter. Both sides have engaged advisers to take the discussions forward.The green energy supplier has carved out a group of wind and solar assets in north and central India for sale. These have a combined capacity to generate 700 MW of power. ReNew Power has a total generation capacity of 8.65 gigawatts (GW).“They have arrived at a high level understanding on the deal. The final closure will depend on satisfactory due diligence and agreement on valuation,” an executive aware of the discussions said.If the talks were to progress into a transaction, this would be the second tranche of asset sale by ReNew Power after it recently divested some of its power assets in Karnataka to UK government-backed Ayana Renewable for ₹1,600 crore as part of its ongoing monetisation drive to deleverage its balance sheet. 79333612GAIL, which was formerly known as Gas Authority of India Ltd, has been targeting renewable energy assets as part of a diversification strategy.“As a part of growth strategy, GAIL is continuously looking for business opportunities including renewables through M&A and/or develop RE (renewable energy) plants through bidding route for both organic as well as inorganic growth,” a spokesperson for GAIL said. “However, GAIL is unable to provide comments on any specific opportunity due to confidentiality of issues.” The state-owned company is the largest transporter of gas in the country with a network of 12,426 km of gas pipelines. The company transports 70% of all gas shipped domestically.ReNew Power declined to comment.ReNew has been looking at asset sales as part of a strategy to ‘churn capital’, as per sources close to the company. The company will sell legacy assets and realize gains from these older investments with an objective to redeploy the proceeds into new projects, these sources said.Industry observers also pointed that cash flows of state-owned power distribution companies or discoms have been adversely impacted due to the pandemic as power demand in the commercial and industrial segment has fallen and recoveries from customers have been hurt due to overall stress.