Mumbai-listed diversified company Grasim Industries Limited has approved the acquisition of 26% equity stakes in three special purpose vehicles (SPVs) to secure renewable energy for its manufacturing units in Gujarat, Andhra Pradesh and Odisha, according to a stock exchange filing.
The SPVs are being set up in partnership with Prozeal Green Energy Limited and GMR Energy Limited to develop captive wind-solar hybrid and green power projects aimed at optimising energy costs and ensuring compliance with captive consumption rules under India’s electricity laws.
For its Vilayat plant in Gujarat, Grasim will acquire a 26% stake in Pro-Zeal Green Power Eighteen Private Limited, a joint venture with Prozeal Green Energy. The company plans to invest up to INR450mn ($5mn) in one or more tranches for the 50-MW project.
Similarly, Grasim will invest up to INR205mn to take a 26% stake in another SPV being formed with Prozeal Green Energy for its Balabhadrapuram plant in Andhra Pradesh.
For its Ganjam plant in Odisha, Grasim will acquire a 26% stake in a new SPV to be formed with GMR Energy Limited, with an investment of up to INR36mn.
The company said the acquisitions, all to be completed through cash consideration, are not related-party transactions and require no additional regulatory approvals. Each SPV will be structured as a captive user vehicle supplying renewable power directly to Grasim’s manufacturing facilities.
Grasim, part of the Aditya Birla Group, operates India’s largest viscose and chemicals plants and has been increasing its investment in renewable energy integration to reduce carbon emissions across its operations. The company said the acquisitions are expected to be completed within 30 days of signing the respective share purchase and shareholders’ agreements.
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