Suzlon Energy, the world's third-largest wind-turbine supplier, plans to sell its remaining stake in Hansen Transmissions, the Belgium-based wind-gearbox maker, reversing out of an acquisition it made only three years ago.
Sumant Sinha, Suzlon's chief operating officer, told the Financial Times that as the company completed the refinancing of about $2.5bn of debt over the next two months it would seek to sell its 26 per cent stake in Hansen.
India's largest wind-turbine maker would also buy out minority shareholders in Repower Systems, the German wind-turbine maker it took control of in May 2007 and in which it owns 91 per cent.
Suzlon was at the forefront of India's global acquisition push during 2006 and 2007. But its highly leveraged expansion at a time of high asset values quickly fell victim to the global financial crisis.
Suzlon bought Hansen in 2006 for $565m, but has steadily sold down its stake over the past year to help repair its overstretched balance sheet. Last month, it sold 35 per cent of Hansen for $370m, following an earlier sale of a 10 per cent holding in a private equity deal worth about $127m.
Suzlon, based in Pune in Maharashtra, has a manufacturing capacity of 4200MW a year and has about 10 per cent of the global wind-turbine market. It supplies turbines to North America, Europe and Asian markets, including China.
After a rapid transformation into an Indian multinational company, the company's order book and capital raising requirements were badly hit by the financial crisis. It was struck again when cracks were found in blades supplied to the US market.
Mr Sinha said financing for wind projects had yet to reignite in the US market but he was encouraged by rising demand in India and Repower's healthy order book.
He said Suzlon was tightening its internal controls and had learned about the need to communicate better with clients and investors.
Suzlon yesterday secured a $412m order from Rajasthan State Mines and Minerals for the supply of 15 wind turbines to power 13.5MW of energy. The order followed a large onshore contract won by Repower to supply wind turbines to Quebec, Canada.
Source: FT