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IDFC PE puts $86 mln in Suzlon parts unit

Indian wind turbine maker Suzlon Energy Ltd  on Monday said IDFC Private Equity would buy 17.1 percent in subsidiary SE Forge Ltd for 4 billion rupees ($86 million).

SE Forge, which specialises in large-scale foundry and forging materials, is expanding capacity at its plants in Coimbatore in south India and Vadodara in the west to cater to the growing demand in the wind energy sector, it said.

Suzlon will continue to hold the remaining stake in SE Forge.

“The wind energy sector is expected to maintain its high growth supported by increasing cost-competitiveness of wind energy, high crude prices, thrust for green power and support from governments,” Luis Miranda, president and chief executive of IDFC PE, said in a statement.

“There is a demand supply gap for large casting and forging products globally and an increasing requirement from the wind and other industries for such products.”

Yes Bank was the adviser to the transaction.

Suzlon, which last week announced a plan to raise up to 18 billion rupees from a rights issue, said the funds would be used to buy Martifer's  stake in REpower and for potential buyout of any minority shares that are offered.

The terms of the rights issue will be announced later, it said.

Suzlon had said earlier this month it had struck a deal with Portuguese conglomerate Martifer for an early acquisition of its stake in REpower for nearly $400 million. ($1=46.5 rupees)

Source: Reuters

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