India’s leading Mahindra Group, specializing in farm equipment, utility vehicles, information technology, and financial services, has joined forces with Ontario Teachers’ Pension Plan Board (Ontario Teachers’), a global institutional investor. Together, through their associates, they co-sponsored an Infrastructure Investment Trust (InvIT) focused on renewable energy assets. Named ‘Sustainable Energy Infra Trust’ (SEIT), the InvIT has successfully raised primary capital of INR 1,365 Crore (USD 165 Million) as part of its initial offer of units (Offer). The Offer saw subscriptions from prominent global and Indian investors, including the Asian Infrastructure Investment Bank (AIIB). Today, SEIT made its debut on the National Stock Exchange of India Limited.
Aligned with their commitment, Mahindra Group and Ontario Teachers’ established SEIT to concentrate on scaling up India’s renewable energy sector. SEIT holds operational renewable power assets with a generation capacity of approximately 1.54 GWp, initially seeded by Mahindra Susten. As part of the Offer, Mahindra Susten received INR 897.8 Crore (USD 108 Million) through an offer for the sale of SEIT units, positioning it for future growth and the development of a pipeline of renewable energy assets. In line with their growth strategy, Mahindra Susten and SEIT have entered into a Right Of First Offer (ROFO) arrangement, complying with InvIT Regulations. This arrangement ensures that renewable energy assets developed by Mahindra Susten will be offered for sale to SEIT.
Previously committed to investing up to INR 3,050 Crore (USD 368 Million) and INR 3,550 Crore (USD 428 Million) into Mahindra Susten and SEIT, respectively, both Mahindra Group and Ontario Teachers’ reaffirm their dedication to India’s green energy goals. Dr. Anish Shah, Group CEO & MD of Mahindra Group, emphasized the importance of SEIT in contributing to the nation’s green energy goals, aligning with the government’s ambitious targets for carbon intensity reduction and achieving net-zero carbon emissions by 2070. Deb Hajara, Managing Director, Infrastructure & Natural Resources at Ontario Teachers’, highlighted the significance of co-sponsoring SEIT in supporting India’s renewable energy ambitions.
Avinash Rao, CEO of the Investment Manager to SEIT, expressed enthusiasm about the growth potential in India’s renewable energy sector, citing the government’s focus on sustainability and renewable energy. The InvIT structure is seen as investor-friendly and conducive to attracting significant interest in operating renewable energy and infrastructure investments in India.
The transaction was facilitated by Kotak Mahindra Capital Company Limited, Axis Capital Limited, and Avendus Capital Private Limited acting as Placement Agents. Legal counsels for SEIT and the Sponsors were provided by Cyril Amarchand Mangaldas, while S&R Associates served as legal counsels to the Placement Agents.
