Virescent Renewable Energy Trust Raises ₹21.5 Billion in Debt Financing

The proceeds will be used to refinance debt and fund acquisitions

November 15, 2021


Virescent Renewable Energy Trust (VRET), a renewable energy infrastructure investment trust (InvIT) from KKR’s Virescent Infrastructure, has raised a total of ₹21.5 billion through listed non-convertible debentures and long-term debt financing.

VRET raised ₹10 billion (~$134.41 million) in its maiden issuance across 3, 5, and 7 year-tranches. The proceeds will refinance existing debt at the special purpose vehicle (SPV) level and fund future acquisitions. Barclays Bank, Trust Investment Advisors, and ICICI Bank were the bookrunners for the issuance.

VRET has tied up an additional ₹10 billion (~$134.41 million) in long-term financing from L&T Finance to ensure a complete debt tie-up of its near-term acquisition pipeline. VRET has also availed a working capital facility of ₹1.5 billion (~$20.16 million) from Tata Capital to enhance its liquidity position and meet its credit rating requirements.

VRET said it had been assigned a” AAA’ rating for its loan facilities from CRISIL and India Ratings.

Funding at the InvIT level entails a cash pooling mechanism and cross-collateralization of security, ensuring a cleaner capital structure. This benefits all lenders, investors, and long-term financiers.

In September this year, VRET had raised ₹4.6 billion (~$62 million) from foreign and domestic investors. Alberta Investment Management Corporation (AIMCo), a Canada-based institutional investment manager, led the funding round.

Virescent Infrastructure had filed a draft placement memorandum with the Securities and Exchange Board of India and the National Stock Exchange of India to list its infrastructure investment trust (InvIT) on the Stock Exchange in July. The company expects to raise gross proceeds of ₹4.25 billion (~$57.12 million) through this listing for its solar assets in India.

In October 2020, KKR, a global investment firm, launched Virescent Infrastructure to acquire renewable energy assets in India. VRET’s initial portfolio includes nine operational solar projects with a total capacity of 395 MW. The projects are located in Maharashtra, Gujarat, Tamil Nadu, Rajasthan, and Uttar Pradesh.  

The company is also in talks with Focal Energy to acquire a 55 MW portfolio. In May, it acquired 76 MW of solar projects from Singapore-based Sindicatum Renewable Energy.