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Wind turbine maker Suzlon Energy today divested 75% of its stake in Chinese manufacturing facility to Poly LongMa Energy for $28 million (Rs 176 crore).
The first tranche of payment by Chinese conglomerate, Poly LongMa is already completed. Suzlon Group will however continute to own 25% in Suzlon Energy Tianjin (SETL), and will operate as a joint venture partner.
“With this joint venture, we monetise an asset we have built up from 2006, and through our partner,
Poly LongMa Energy, maintain our strong presence in the world’s largest market, which remains strategically important for us. The new joint venture will be very well positioned in China, and offer
the potential to explore exports as well,” said Tulsi Tanti, chairman of the Suzlon Group.
Suzlon is currently under corporate debt restructuring (CDR) with as much as Rs 9,000 crore worth loans which were restructured. As a part of CDR terms, Suzlon will have to raise money and put in equity into the company. For this, it had identified many of its subsidiaries as well as real estate to raise this money.
“While this deal has taken time and changes to fructify, we believe this achieves the best possible balance for the group and our stakeholders, including our customers, vendors, lenders and employees,” said Tanti.
After the deal is compelte, the larger shareholder, Poly LongMa Energy will lead marketing and sales operations in China. Suzlon will continue to remain the technology partner with its existing Chinese portfolio. Its Chinese portfolio includes turbines with with capacities of 1.25 megawatts, 1.5 MW and 2.1 MW. Suzlon will also manage manufacturing and quality of the venture.
