Total to invest USD 300 mn in new green energy JV with Adani

TotalEnergies SE will invest USD 300 million in a new clean energy joint venture with the Adani Group
Total to invest USD 300 mn in new green  energy JV with Adani
Total to invest USD 300 mn in new green energy JV with AdaniEnergy Watch

New Delhi: TotalEnergies SE will invest USD 300 million in a new clean energy joint venture with the Adani Group, marking the French energy giant's first public deal since a US short-seller levelled fraud allegations against Gautam Adani's business empire. Total will hold a 50 percent stake in the new joint venture firm, with Adani Green Energy Ltd holding the rest, the two firms said in a statement.

Adani-Total JV will hold a portfolio of 1,050 MW of RE projects

The joint venture will hold a portfolio of 1,050 MW, including 300 MW of already operational capacity, 500 MW under construction and 250 MW under-development assets with a blend of solar and wind power. The investment is part of Total's drive to expand its portfolio of clean energy projects.

Total already has a 19.7 percent stake in Adani Green Energy Ltd (AGEL). It also has an equal joint venture with AGEL, called AGE23L that holds a portfolio of 2,353 MW.

In a stock exchange filing, AGEL said its board has approved "the execution of a binding term-sheet to be entered into between Adani Green Energy Twenty Three Limited (AGE23L) and TotalEnergies SE (Total) pursuant to which, inter alia, Total will make further investment (either directly or through its affiliates) of USD 300 million to form a new 50:50 joint venture company with the company and modify certain terms of its investment in AGE23L".

Besides investing in the renewable energy business of Adani Group, Total in 2019 invested USD 600 million to buy a 37.4 percent stake in Adani Gas Ltd, now called Adani Total Gas Ltd.

USD 300-mn investment first since Hindenburg report

The USD 300 million investment is the first since the Hindenburg report in January highlighted Adani Group's debt pile and alleged accounting fraud and stock manipulation, which Adani denies. Shortly after that report, Total put a planned USD 4 billion in a green hydrogen project with the embattled group on hold, saying it was waiting for more clarity on the Indian conglomerate's situation before proceeding.

Total was to take a 25 percent in Adani New Industries Ltd (ANIL). The status of Total's investment in ANIL is not immediately known.

'Total developing its presence in India's RE market via AGEL'

TotalEnergies Chairman and CEO Patrick Pouyanne commented, "TotalEnergies has been actively developing, notably through AGEL, its presence in the Indian renewable power market, a very interesting market by its size and growth and the early development of a merchant market. After our first joint venture AGEL23 in 2020 and our acquisition of shares in AGEL in 2021, this new joint venture with AGEL will enable us to speed up our development through direct access to a large portfolio of assets and to support the ambition of AGEL in becoming the Indian leader of renewable energy."

The Hindenburg report had led to a USD 150 billion loss in the market value of Adani group stock at its lowest part. Adani's stocks have recouped some losses since then, particularly after it received investment from GQG Partners, and an interim report from an Indian Supreme Court-appointed panel in May said it found no evidence of stock-price manipulation.

Adani Group Chairman Gautam Adani commented: "We are delighted to extend our long-term partnership with TotalEnergies in AGEL. The investment will further strengthen the pivotal role played by AGEL in India's glide path to decarbonisation. This will help deliver our vision to have 45 GW renewable energy capacity by 2030".

Adani Green Energy Limited (AGEL) is the renewable energy platform of Adani Portfolio. It has one of the world's largest renewable portfolios, with locked-in growth of 20.4 GW across operational, under-construction, awarded and acquired assets, catering to investment-grade counter-parties.

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