Adani Green Energy (AGEL), through its subsidiary Adani Solar Energy AP Six, has raised a ¥27.95 billion (~$205.31 million) project loan facility to help refinance its debt.
This facility includes amortizing project loans, a 16-year debt structure with a ten-year door-to-door tenor and an average tenor of more than eight years.
It is supported by the association of AGEL and its two core relationship banks – MUFG Bank and Sumitomo Mitsui Banking Corporation, which act as the main lenders for the facility with equal participation.
This facility is linked to Japan’s benchmark rate – the Tokyo Overnight Average Rate, with close to zero yield, highlights the appeal to diversify the alternative capital pools to provide relatively competitive interest rates.
Adani Green aims to have access to long-term capital without impacting its growth assets and continues to look at several alternative pools of capital like this to finance its contribution to India’s clean energy transition.
The company stated that the refinancing facility is consistent with its strategy to secure long-term financing to establish a debt structure in line with the basic life of its operational assets.
Phuntsok Wangyal, CFO of Adani Green Energy, said, “The facility demonstrates AGEL’s proactive and continuous approach to accessing liquidity against the backdrop of a challenging interest rate environment in the broader market, providing a long-term solution. With a benchmark rate that lower, lower margins, and past swap rates, this provides significant flexibility and a competitively priced funding solution for AGEL’s portfolio of high-grade renewable assets.
Latham & Watkins LLP and Cyril Amarchand Mangaldas acted as legal advisors to the transaction.
Adani Green Energy recorded a cash profit of ₹ 6.01 billion (~$73.98 million) in the second quarter of financial year 2023, an increase of 50% YoY, due mainly to an increase in electricity sales.
Earlier this year, the company also received an investment of $500 million from Abu Dhabi-based public joint stock company International Holding Company PJSC (IHC) out of a total investment of $2 billion in three Adani Group companies.