France's TotalEnergies to invest $300 mn in JV with Adani Green Energy

Gautam Adani-led Adani Green Energy Twenty Three Limited (AGE23L) has signed a binding termsheet with French energy giant TotalEnergies SE for a 50:50 joint venture with a 1,050 MW portfolio. Under the deal, TotalEnergies will invest $300 million, a regulatory filing by the Adani Group company stated on September 20. Both Adani Green Energy and Total will hold an equal stake of 50 per cent in the new JV.

This portfolio will comprise a mix of already operational (300 MW), under construction (500 MW) & under development assets (250 MW) with a blend of both solar and wind power. AGEL will contribute to the JV the assets and TotalEnergies an equity investment of 300 MUS$ which will further support their development.

"The purpose of a binding termsheet is to provide for further investment by Total (either directly or through its affiliates) of USD 300 million to form a new 50:50 Joint Venture Company with the company and modify certain terms of its investment in AGE23L," the exchange filing stated.

TotalEnergies will reinforce its strategic alliance with AGEL and support the company in becoming the Indian leader of renewable energy, with a target of 45 GW of renewable power capacity by 2030. Total, through its affiliate entities, holds 19.75 per cent shareholding in Adani Green. 

Besides this, TotalEnergies and the Adani Group also have an existing listed joint venture, Adani Total Gas.

The transaction details are "under discussion", and both companies will discuss and agree to these in the definitive agreements, Adani Green Energy said.

Adani Group chairman Gautam Adani said: “We are delighted to extend our long-term partnership with TotalEnergies in AGEL. The investment will further strengthen the pivotal role played by AGEL in India’s glide path to decarbonization. This will help deliver our vision to have 45 GW renewable energy capacity by 2030.” 

The move comes seven months after the French energy major said it will hold the $4 billion green hydrogen project with the Adani Group after Hindenburg Research published a report on the group.

US-based Hindenburg Research had accused the Adani Group of stock price manipulation of listed companies through offshore entities and undisclosed related party transactions.

Hindenburg’s report claimed “brazen accounting fraud” and “stock manipulation” by the Gautam Adani-led group. Though the conglomerate rejected the report as “unresearched” and “maliciously mischievous”, it triggered a massive rout of Adani Group stocks, which lost over $140 billion in days and forced the cancellation of a ₹20,000 crore share sale in the group’s flagship.

In July this year, Adani Green Energy said it will be raising Rs 12,300 crore from a public sale of shares to institutional investors.

Following a board meeting, the company said it will raise the capital via qualified institutional placement (QIP) or any other eligible securities.

The amount of funds to be raised will be subject to regulatory and statutory approvals, as well as the approval of AGEL's shareholders by way of postal ballot process, a company filing stated. 

On Wednesday, shares of Adani Green Energy closed at Rs 1012.50, up by 0.79 per cent.