Adani Green Unit Transfers 74% Stake in Mundra Solar Energy to Adani Tradecom

The transaction has been conducted at arm's length basis, while the shareholding transfer is based on an independent valuation report


Adani Renewable Energy Holding Four Limited, a wholly-owned subsidiary of Adani Green Energy Limited (AGEL), has transferred 74% shareholding of Mundra Solar Energy Limited (MSEL) to Adani Tradecom LLP (ATLLP) on May 21, 2021.

AGEL disclosed the details of the transfer before the Bombay Stock Exchange. In all, 7,400 equity shares were transferred to ATLLP at face value, i.e., ₹10 (~$0.14), each aggregating to ₹74,000 (~$1,015).

MSEL has an authorized share capital of ₹500,000 (~$6,863.80), paid-up share capital of ₹100,000 (~$1,372.75).

MSEL is incorporated in India and registered with the Registrar of Companies, Gujarat at Ahmedabad on October 18, 2019, and is a step-down subsidiary of the AGEL. It has been transferred to ATLLP on an arm’s length basis. The shareholding transfer is based on an independent valuation report.

MSEL was incorporated to manufacture crystalline silicon solar photovoltaic cells, modules, and ancillary operations. These operations are quite similar to the line of businesses undertaken by Adani Enterprises Limited through its subsidiary, Mundra Solar PV Limited. This acquisition is expected to bring synergy to Adani’s current manufacturing operations and enhance the market share by its brand value.

MSEL was a special purpose vehicle created to participate in the manufacturing-linked solar project development tender. The tender had specified that the bidders had to have 26% holding in a solar manufacturing unit and the same entity had to undertake manufacturing of capacity under this tender. MSEL was created with a 26% stake in MSPVL and 74% by Adani Green. The company is restructuring its units and this transfer is a part of the process, according to an executive of the company.

Last year, Adani Solar elaborated its plans to expand its cell and module manufacturing facility with an additional capacity building of 2 GW. “The new capacity will come online in 2021. The proposed capacity expansion of its facility is in expectation of the domestic demand of 10-12 GW in 2021. With this expansion, the company’s total cell and module manufacturing capacity will reach 3.5 GW,” said a spokesperson of Adani Solar.

Last week, AGEL signed a share purchase agreement to acquire a 100% stake in SB Energy India from Soft Bank Group (80%) and Bharti Group (20%). The transaction marks the largest acquisition in the renewable energy sector in India. SB Energy India’s transaction values at an enterprise valuation of about $3.5 billion (~₹260 billion). The deal is expected to be completed by August 2021.

Rahul is a staff reporter at Mercom India. Before entering the world of renewables, Rahul was head of the Gujarat bureau for The Quint. He has also worked for DNA Ahmedabad and Ahmedabad Mirror. Hailing from a banking and finance background, Rahul has also worked for JP Morgan Chase and State Bank of India. More articles from Rahul Nair.