Suzlon sells Senvion for $1.2 bn to cut debt

New Delhi, January 22

Wind turbine maker Suzlon Energy today announced the sale of its German unit Senvion SE to US private equity firm Centerbridge Capital Partners LLC for a sum of 1 billion euros ($1.2 billion) in an all-cash deal to cut its debt.

Suzlon said it has signed with Centerbridge a binding agreement, which also has a future earn out clause of an additional 50 million euros.

Proceeds from the sale of Hamburg-based Senvion SE will be used to pare debt as Suzlon focuses on home and high-growth markets, it said.

The Rs 7,200-crore deal, which is subject to regulatory and other customary closing conditions, is expected to be completed before the end of March, Suzlon said.

At the end of the second quarter of the current fiscal, Pune-based Suzlon had Rs 8,900 crore of local-currency debt and dollar borrowings of $1.27 billion, including working capital loan.

Suzlon had in 2007, bought a 33.9% stake in Senvion, then known as REpower Systems AG, after a bidding war with France’s Areva. That deal valued Senvion at 1.2 billion euros. It bought full control of the firm in 2011.

“We are pleased to announce this development, which is in line with our strategic initiative to strengthen our balance sheet. The proceeds would be used for debt repayment thereby reducing interest cost and augment business growth,” Suzlon chairman Tulsi Tanti said. — PTI