Indowind set for $100 mn buy

Chennai firm targets European wind energy company

Chennai-based Indowind Energy is in advanced stages of negotiations to acquire a wind energy company in Europe for an estimated price of around $100 million (Rs 400 crore). The acquisition, if successful, will help the wind energy and farming company to expand its footprint both in domestic and global markets.

This will make Indowind the second Indian wind power company to clinch an overseas acquisition. Suzlon Energy has two high-profile acquisitions "� Belgium's Hansen Transmissions International and Germany's REpower "� under its belt.

"The company is close to acquiring a power company in Europe, while it is also in discussions with a couple of companies in the region for purchasing of power technology. The acquisition is in the final stages and the company would soon announce the deal," a source close to the development told Business Standard.

The acquisition price for the wind energy company would hover around $100 million, while the Indian company would spend another $50 million on technology, he said. He, however, did not divulge the name of the company, citing competition.

When contacted, Indowind Energy chairman K V Bala declined to comment.

The company had raised around Rs 100 crore from a recently concluded initial public offering (IPO) and another $100 million through a Foreign Currency Convertible Bonds (FCCB) issue. Indowind Energy has got commitments of $50 million from a clutch of bankers and intends to use part of these proceeds for the acquisition.

The BSE- and NSE-listed company would also use the proceeds to set up a 1000 MW project in Karnataka, for which it has received approvals from the Power Finance Corporation Ltd (PFCL).

The company is in the process of installing an additional capacity of 9 MW at the wind farm project at Chitradurga district in Karnataka, and has acquired 125.23 acres of land in the state for the purpose. It has a power generation capacity of 17.915 MW and intends to raise this to 50 MW by the end of the financial year.

The company supplies power to state electricity boards and other corporates and is planning to get into farming.