Actis sells India renewables platform to Shell for $1.55b
Actis has sold Indian renewables platform Sprng Energy, including its flagship solar business Solenergi Power, to Shell Overseas investment for USD 1.55bn.
The private equity firm - which now describes itself as a green infrastructure investor - established Sprng in 2017 to supply solar and wind power to electricity distribution companies in India. Its assets have grown from an initial capacity of 330 megawatts to 2.9 gigawatts, of which 2.1 GW are operational. It has a further 7.5 GW of projects in the pipeline.
Actis said the scaling process was guided by a hands-on strategy featuring a corporate responsibility program and an impact assessment that featured a biodiversity analysis and work on the noise and shadow flicker effects of wind turbines. In separate research, flickering shadows created by sunlight passing through turbines have been tentatively linked with health problems.
About USD 450m was mobilised for deployment in Sprng during its early development by Actis’ fourth emerging markets energy fund, which closed at USD 2.75bn in 2017. Fund V closed last year at USD 6bn. Sanjiv Aggarwal, a partner at Actis, said the firm would invest a further USD 1bn in India and the broader region by the end of 2026.
Sprng acquired its first asset in 2017, a 250 MW solar project in Madhya Pradesh with a 25-year government energy offtake arrangement. Early investment in the platform also included the acquisition of a 194 MW solar portfolio from SP Infra, an arm of Shapoorji Pallonji Group, in 2019.
Sprng will retain its existing brand and operate as a wholly-owned subsidiary of Shell, which hopes to become a profitable net-zero emissions business by 2050. It extends a string of similar acquisitions for the oil giant across solar, wind, and energy storage. Sprng triples Shell’s renewable energy capacity in operation.
“This deal positions Shell as one of the first movers in building a truly integrated energy transition business in India. I believe it will enable Shell to become a leader across the power value chain in a rapidly growing market where electrification on a massive scale and strong demand for renewables are driving the energy transition,” Wael Sawan, Shell’s renewables director, said in a statement.
“Sprng Energy generates cash, has an excellent team, strong and proven development track record and a healthy growth pipeline. Sprng Energy’s strengths can combine with Shell India’s thriving customer-facing gas and downstream businesses to create even more opportunities for growth.”
Actis has invested in around 70 renewable energy projects globally. Sprng was set up as the successor to Ostro Energy, a similar platform founded in 2014 to bid on power contracts and build and operate renewable energy assets. Ostro had a capacity of 1,100 MW across its wind and solar assets by the time Actis exited the platform to ReNew Power Ventures in 2018.
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