French energy behemoth Electricite de France SA (EDF) is strategising a partial divestment of its clean energy assets in India as part of a broader initiative to alleviate its towering debt exceeding $50 billion, according to sources familiar with the matter.
Currently, EDF’s subsidiary, EDF Renewables India, boasts 530 MW of operational assets spread across Rajasthan and Gujarat, with a robust clean energy pipeline of 1 GW in the country. To facilitate this divestment, EDF has enlisted the services of Rothschild to oversee the sale process, reaching out to a spectrum of global infrastructure investors including KKR, Actis, CDPQ, Sembcorp, and domestic players like JSW, Torrent, and Edelweiss Infrastructure-backed Sekura Energy. The move comes amidst a flurry of activity in the Indian renewable energy sector, with several key players like Brookfield, Shell, and Enel looking to offload their assets in the market.
Sources indicate that EDF is inclined towards retaining a minority stake in its Indian clean energy ventures, with plans to offload approximately 50-70% of its assets. The potential deal is estimated to value the operational assets at around ₹3,000-3,500 crore (approximately $400 million). EDF’s decision to divest comes at a crucial juncture as the company grapples with a staggering net debt of ₹54.4 billion ($58.7 billion) as of 2023-end. Despite a rebound in its financial performance, EDF faces challenges stemming from falling electricity prices and operational issues in its nuclear power plants across Europe. In India, EDF operates through various entities, including EDF India, EDF International Networks, Citelum India, EDEN Renewables, and EDF Renewables India, contributing significantly to the country’s clean energy landscape. Additionally, EDF has been actively involved in infrastructure projects like the Jaitapur nuclear power project in Maharashtra, demonstrating its commitment to India’s energy sector. With its latest divestment move, EDF aims to streamline its operations and strengthen its financial resilience amidst evolving market dynamics.
