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Mumbai, Jan. 2 Suzlon Energy Ltd, a leading wind turbine manufacturer, has decided to sell a 10 per cent stakein the gear box company Hansen Transmissions International to London-based investment firm Ecofin Ltd, which specialises in utility and infrastructure sectors, according to a press release.

The stake sale is expected to fetch Suzlon about Rs 600 crore, according to reliable sources. The deal was struck on December 31, 2008 at a price close to Hansen’s closing price on the London Stock Exchange, according to the sources. Hansen’s shares closed at 116.75 pence on the exchange on Wednesday.

Suzlon is the largest shareholder of Hansen and part of the advisory board. After the stake sale, Suzlon will retain a voting right and economic interest of about 61 per cent in Hansen.

The company has not disclosed the value of the transaction.

Suzlon has taken the step in view of the tight liquidity situation and its obligation to buy the stake of Portuguese company Martifer in REpower, Germany.

Ecofin will get 67,010,421 shares representing 10 per cent equity interest in Hansen through AE-Rotor Holding, a wholly-owned indirect subsidiary of Suzlon, which is currently holding the shares. Ecofin already holds 1.62 per cent of Hansen shares.

Following completion of the acquisition, Ecofin will have a voting and economic interest in Hansen of approximately 11.62 per cent. It has agreed not to sell the newly acquired in Hansen until June 3, the release said.

The terms of the relationship agreement entered into between Hansen and Suzlon give the latter the right to appoint two non-executive directors to the board of Hansen for so long as its shareholding in Hansen is a minimum of 26 per cent.

Under the terms of the agreement entered into with Ecofin, the company has granted Ecofin the right to nominate one such director for so long as Ecofin’s shareholding in Hansen is a minimum of 8 per cent.

At the closing of the BSE market hours on Friday, the Suzlon scrip was traded at Rs 64.55, a decline of 2.64 per cent over the previous close of Rs 66.30.

Suzlon had acquired the Belgium-based manufacturer of gears for wind turbines in May 2006 for about Rs 2,500 crore (€465 million). It floated Hansen on the London Stock Exchange in December 2007 and raised about €400 million.

More Stories on : Non-conventional Energy | Mergers & Acquisitions | Suzlon Energy Ltd

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