Khaitan & Co: Advises Sumitomo on Clean Solar Power Acquisition

• Sumitomo Corporation acquired a 49% equity stake in Clean Solar Power (Baniyana) Private Limited.
• Clean Solar Power (Baniyana) Private Limited is a subsidiary of Hero Future Energies, part of the Hero Group.
• Khaitan & Co advised Sumitomo Corporation on all legal aspects of the acquisition, including due diligence and document execution.
• The acquired company is developing a hybrid solar and wind project with approximately 500 MWp capacity in Bidar District, Karnataka.
• The project also includes a co-located battery energy storage system to enhance energy delivery.

The integration of battery storage alongside substantial solar and wind capacity positions this project as a cutting-edge example of sustainable energy infrastructure, reflecting the increasing complexity and technological advancement in India's green energy sector.

Sumitomo Corporation has finalized the acquisition of a 49% equity stake in Clean Solar Power (Baniyana) Private Limited. This entity operates as a subsidiary of HSEPL, which is itself an integral part of Hero Future Energies, the dedicated renewable energy division of the prominent Hero Group. This strategic investment marks a significant move for Sumitomo into India's burgeoning clean energy sector, specifically targeting a substantial hybrid renewable energy project.

The transaction sees Sumitomo Corporation securing a considerable minority interest in a key asset, underscoring the ongoing international interest in India's green infrastructure development. The acquired company, Clean Solar Power (Baniyana) Private Limited, is central to the development of a large-scale renewable energy initiative, reflecting a broader trend of foreign direct investment in sustainable power generation within the country.

Khaitan & Co provided extensive legal advisory services to Sumitomo Corporation throughout the acquisition process. Their involvement spanned critical stages, including the negotiation, drafting, and meticulous review of all pertinent transaction documents. A significant component of their mandate involved conducting thorough legal due diligence on both the target company, Clean Solar Power (Baniyana) Private Limited, and the underlying project itself, ensuring all legal aspects were rigorously examined. Furthermore, the firm offered crucial assistance with the final execution of the transaction documents, facilitating the successful closure of the deal.

The Khaitan & Co team was structured to address the multifaceted nature of the acquisition. The core transaction team comprised Partners Zakir Merchant, Shivanshu Thaplyal, and Vidur Sinha, supported by Principal Associate Priyal Modi, Senior Associate Tanuj Modi, and Associate Apeksha Chauhan. Specialized assistance was provided for real estate matters by Partner Sudheer Madamaiah, Counsel Kartik Shiv Kumar, and Associate Harish Bojappa Kugunavar. Regulatory and project-specific aspects were handled by Senior Associate Vardhikaa Sharma, alongside Associates Krishnendu Ghosh, Vivan Jhaveri, Dhrutvi Modi, and Disha Jain. Additional due diligence efforts were led by Partner Vinay Joy, Senior Associates Aditya N Nair and Hansaja Pandya, with support from Associates Ajay Kranthi Kothwal, Bhuvan S, and Sonakshi Gopi, highlighting the depth of expertise required for such a complex Khaitan & Co deal street transaction.

The primary asset involved in this acquisition is a sophisticated hybrid renewable energy project located in the Bidar District of Karnataka, India. This ambitious undertaking combines both solar and wind power generation, boasting an aggregate capacity of approximately 500 MWp. A key feature of this project, and a growing trend in the India renewable energy M&A landscape, is the inclusion of a co-located battery energy storage system, designed to enhance grid stability and optimize energy delivery.

This Hero Group solar wind project represents a significant step forward in integrated renewable energy solutions, moving beyond single-source generation to incorporate multiple technologies for greater efficiency and reliability. The integration of battery storage alongside substantial solar and wind capacity positions this project as a cutting-edge example of sustainable energy infrastructure, reflecting the increasing complexity and technological advancement in India's green energy sector.

This transaction highlights continued foreign investment and M&A activity in India's renewable energy sector, particularly in hybrid solar-wind projects with battery storage. Lawyers advising clients on energy projects or inbound investment in India should note the complexity of due diligence (real estate, regulatory, project-specific) and deal structuring for such large-scale, multi-technology assets, indicating a robust market for similar future transactions.

Source: Based on industry reporting.