The Hindu Business Line : `REpower takeover won't affect Suzlon'

Mumbai May 25 Suzlon's takeover of German wind energy company REpower will not affect the company's balance sheet, said Mr Tulsi Tanti, Chairman and Managing Director of Suzlon Energy Ltd. REpower's growth will help Suzlon pay for its acquisition in the coming years, he told the media after clinching the deal.

Mr Tanti said that a total transaction cost of € 1.3 billion would be paid over three years and with an upfront investment of upto € 250 million Suzlon has gained control of the company from day one.

FCCB issue

The company has not incurred any major debt, and the debt-to-equity ratio remains the same.

A part of the recently raised $300 million FCCB issue would be utilised for this deal, he said.

Explaining Suzlon's investment of only € 250 million, he said, the company has already invested € 100 million in the deal and the rest € 150 million would be invested on Friday through buying shares from minority shareholders, he said.

Suzlon and French nuclear company Areva were close competitors for acquiring REpower.

However, on Thursday, Areva gave up the bid and chose to co-operate by giving Suzlon its own voting rights. Areva has been given an exit option from REpower after one year.

Mr Tanti said there was no guaranteed exit price to Areva as it was difficult to predict what will be the price of REpower's share one year down the line.

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