December 2008
« Nov   Jan »

Contact us

Top P E fiirms reported to be in Sulzon stake deal: report

Wind power equipment maker Suzlon Energy, after having negotiated a revised payment schedule with the Martifer Group of Portugal to acquire its 22.4-per cent stake in Germany's REpower Systems AG , is now trying to raise $500 million to fund this stake by selling a 10-15 per cent stake in itself, to potential suitors like the Carlyle Group and TPG Capital. 

According to media reports quoting bankers close to the deal, said that the Carlyle Group and TPG Capital may be interested in acquiring 10 to 15 per cent stake in Sulzon Energy for approx $300 million and the wind power equipment maker, would be raising an additional $200 million by way of debt offering or selling stakes from its other units.

In September this year, Sulzon agreed to acquire Portuguese conglomerate Martifer's 22.48-per cent stake in REpower Systems for €270 million ($396 million).

The acquisition was to have been completed by 15 December and the company was in danger of breaching its debt pact with lenders if it went ahead with the acquisition of Martifer stake. Nor was it in a position to push it back as it could potentially result in legal action from its lenders.

Suzlon had provided Martifer with a bank guarantee valid until May, even as chairman Tulsi Tanti said the company planned to use its own cash for the purchase and may raise some debt to buy the stake.

In the beginning of November, Suzlon had been trying unsuccessfully to raise funds to acquire the rest of the stake and according to sources, Suzlon was exploring options to sell its stake to private equity firms to raise funds for the REpower acquisition.

Last week, Suzlon Energy had negotiated a revised payment schedule with the Martifer Group of Portugal to acquire its 22.4-per cent stake in REpower Systems AG, Germany.

Under the new revised payment schedule, Sulzon will pay Martifer approximately €65 million in December 2008, €30 million in April 2009 and final tranche of €175 million in May 2009 and until that date, Martifer will benefit of the bank guarantee covering Suzlon's obligations, while the revised payment schedule will give the Indian company a much-needed breather.

Suzlon Energy had acquired the German wind turbine manufacturer Repower, with the French nuclear energy group Areva, having decided to withdraw from the bidding against the Indian company in May 2007.

Source: Domain B

Comments are closed.