The remaining $600 million will be disbursed based on performance-linked milestones as projects scale up. Avaada Ventures is the holding company of the group.
Funds raised from Brookfield will be used for the group’s solar cell/module manufacturing and green ammonia plans, as well as scaling up its renewable energy generation capacity.
ET first reported on March 13 that Brookfield is in advanced talks to invest up to $1 billion in the Avaada Group.
Avaada is also negotiating with existing investor, Thailand’s state-owned utility PTT, to deploy another $300 million.
PTT had in July 2021 invested $454 million in Avaada Energy, the solar arm of the Avaada Group, and holds a 43% stake in that unit. The additional investment by PTT may be made in the solar arm, said the people cited above.
Shareholder approvals and clearances are being worked out before a formal announcement on the fundraising is made, they added.
Company’s plans
At a total $1.3 billion, this would be the largest capital raise by a clean energy company in one go. In March 2021, Japan’s Orix Corp. had invested $961 million in GIC-backed Greenko Energy Holdings for a 21.8% stake, while the SPAC merger and overseas listing of Renew Power in August 2021 saw an equity infusion of around $1.2 billion in the merged entity.
Brookfield declined to comment on the development.
“We do not comment on media speculation and rumours,” said a spokesperson for the Avaada Group. There was no response to queries sent to the PTT Group.
Avaada Energy had commissioned solar projects to the tune of 2,937 MW by April 30, 2022, and has a pipeline of about 1,526 MW, as per a report by credit rating agency IndiaRatings.
The group’s cell/module plans include a state-of-the-art facility with an annual production capacity of 5 GW, expected to become operational in 2023. Avaada intends to scale up its capacity to 10 GW by 2030, along with backward integration into polysilicon, ingots and wafers.
In August last year, Avaada signed a memorandum of understanding (MoU) with the Rajasthan Department of Industries and Commerce to set up a green ammonia facility and renewable energy power plant in Kota. The MoU proposes an investment of ₹40,000 crore, while providing direct employment opportunities to about 3,500 people and indirect jobs to over 10,500, as per the company’s statements.
Brookfield’s billion-dollar cheque for Avaada comes at a time when renewable and energy transition investments are gaining importance for private equity investors.
Senior management told ET last year that Brookfield is looking to multiply its current 4 GW renewable energy generation portfolio three to four times in India within the next decade, as well as help corporates decarbonise and invest in building a large-scale supply chain.
Brookfield is one of the world’s largest investors in renewable power and climate transition assets, with approximately 24,000 MW of generating capacity worldwide, and $1 billion in assets under management in renewables in India as of September 2022.
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