ReNew Power, an India-based renewable energy provider backed by energy utilities Chubu Electric Power and Tokyo Electric Power, agreed to a reverse merger with special purpose acquisition company with RMG Acquisition Corporation II yesterday.
Funds and accounts managed by BlackRock, BNP Paribas Energy Transition Fund, Sylebra Capital, TT International Asset Management, TT Environmental Solutions Fund, Zimmer Partners and private investor Chamath Palihapitiya have committed $855m of private investment in public equity.
Together with $345m already held by RMG, ReNew Power will have access to $1.2bn in gross proceeds following the merger. The transaction will value the combined business at $8bn and is set to close in the second quarter of 2021.
ReNew Power is expected to list on Nasdaq using the ticker symbol RNW. Its existing shareholders are expected to retain 70% following the merger.
Founded in 2011, ReNew operates more than 100 utility-scale solar power plants and wind farms across nine Indian states. It has also expanded into related areas, such as energy storage.
The company will use proceeds to expand its power generation capacity and to reduce its debt.
ReNew Power had previously geared up for an initial public offering potentially worth up to $1bn in 2018, but did not follow through on those plans.
Instead, it returned to the private market to most recently raise $300m from Goldman Sachs, Canada Pension Plan Investment Board and Abu Dhabi Investment Authority (ADIA) in mid-2019.
Canada Pension Plan Investment Board invested $144m in 2018, following a $200m commitment from Jera, the joint venture formed by Chubu Electric and Tokyo Electric, in 2017.
Goldman Sachs joined Asian Development Bank, Global Environment Fund and a subsidiary of ADIA for a $265m round in 2015, after the former three had already supplied $140m in 2014. Goldman Sachs had injected $200m into ReNew Power in 2011.
