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Renewable Energy M&A: KKR invests $400 million in India-based Serentica Renewables

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The move marks KKR’s sixth major financing in India and builds on its recent agreement to co-invest $450 million in Hero Future Energies - a pan-India, gigawatt-scale utility-scale solar and wind platform. Serentica Renewables was established in 2022 with an ambition to deploy 1.5 GW of round-the-clock renewable power - comprising solar, wind, and energy storage assets. In Sep’22, the company stated that more than 600 MW of the total development pipeline is contracted to affiliates of the Vedanta Group, under long-term PPAs.  The contracted capacity is expected to come online by the end of 2025. Serentica is focused on industrial decarbonization and seeks to make renewables the primary source of energy for the commercial & industrial (C&I) segment. Serentica’s medium-term goal is to install 5GW of carbon-free generation capacity coupled with different storage technologies.

KKR launched its Asia Pacific infrastructure strategy in 2019, and by Jan’21, the firm had closed its first fund under the strategy at $3.9 billion. The fund has a broad investment mandate across both emerging and developed Asia Pacific, in sectors including waste, renewables, power and utilities, telecommunications, and transportation. As per Enerdatics’ research, India accounts for the largest share of KKR’s renewable energy activity in Asia. The firm’s renewables investments in the country started picking up pace in 2020 when it launched Virescent Infrastructure - a solar platform that aims to generate revenue through long-term contracts with utilities in India. Outside of India, KKR launched Aster Renewable Energy in Apr’22, a developer focussed on solar, wind, and energy storage projects in Vietnam and Taiwan, with plans to expand to other markets in Asia.

Other major private equity firms that have made significant investments in the Indian renewables space this year include BlackRock - with its $525 million purchase of shares in Tata Renewable Power - as well as Ontario Teachers' Pension Plan Board and Actis.

The above analysis is proprietary to Enerdatics’ energy analytics team, based on the current understanding of the available data. The information is subject to change and should not be taken to constitute professional advice or a recommendation.

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