TPG, a global alternative asset management firm, has agreed to acquire a majority stake in Siemens Gamesa Renewable Energy’s wind turbine generator businesses in India and Sri Lanka. Siemens Gamesa is a wind power subsidiary of Germany’s Siemens Energy AG.
In a statement on Wednesday, TPG said the transaction was subject to closing conditions and regulatory approvals, but didn’t disclose the financial details of the investment.
Mint reported in May last year that Siemens Energy had put up for sale Siemens Gamesa’s India wind turbine unit to cut losses and return its global wind turbine business to profitability by 2026.
TPG Rise Climate, the global asset management firm’s climate investing platform, will invest in Siemens Gamesa’s India and Sri Lanka businesses through its Global South Initiative, launched with climate fund Alterra to scale climate solutions in the region.
MAVCO Investments, backed by some Murugappa group family members, and former JSW Energy chief executive Prashant Jain will also make minority investments in Siemens Gamesa’s India and Sri Lanka businesses.
Following the closing of the transaction, a new independent company will be created.
Siemens Gamesa will hold a minority stake in this new company and transfer to it about 1,000 employees and its manufacturing infrastructure in India. It will also exclusively license its intellectual property and technology while developing products for the new company, TPG said in the statement.
Vinod Philip, Siemens Energy board member overseeing Siemens Gamesa, said India remains an attractive wind energy market with significant growth potential.
“The new company will serve the Indian market more effectively while also offering a long-term perspective for the employees and customers. This ensures continued support and development in this vibrant market, while Siemens Gamesa can concentrate on other core markets,” Philip said in the statement.
The new company’s board will be chaired by Vellayan Subbiah, who was recently appointed as a whole-time director and designated as executive chairman of Cholamandalam Investment and Finance Company, Murugappa Group’s non-banking financial company. Jain will serve as executive vice chairman of the new entity and Philip will operate as Siemens Gamesa representative on its board.
“We believe onshore wind will continue to play an increasing role in India’s green energy mix and this new platform, with Siemens Gamesa’s world-class product manufacturing and service offering, and the backing of TPG and MAVCO will continue to accelerate the delivery of gigawatts of clean power to millions of Indians across the socio-economic spectrum,” said Ankur Thadani, partner and head of climate, Asia, at TPG.
Morgan Stanley, Kearney, Deloitte, Alvarez & Marsal, Khaitan & Co., Cyril Amarchand Mangaldas, and Cleary Gottlieb Steen & Hamilton jointly advised TPG, MAVCO and Jain on the transaction.
