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RRB Energy plans to tap private equity

According to reports, RRB Energy Limited (RRBEL), a leader in wind power sector, is planning to tap private equity to raise Rs.100-150 crore to fund its expansion plans. “We are in talks with many [PE players], but not zeroed in on anyone,” Deputy Managing Director Sarvesh Kumar said.

The plan was to raise the funds two years from now and discussions, with such investors, would be launched this year, he said here on Friday.

Addressing presspersons to announce the successful commissioning of the prototype of 1.8 MW wind electric generator, developed using in-house R&D and with help from world-class consultants, he said next in line would be 3 MW turbine, for onshore and offshore locations. The development and manufacture of the new range of turbines was estimated to entail an additional investment of Rs.125 crore. For RRBEL, whose investment in its manufacturing facility in Poonamallee, near Chennai, was about Rs.225 crore, it made more sense to raise money through the PE route, he said.

“The best way of raising money is PE,” he said. The company, which is celebrating its 25{+t}{+h}year, was not looking at initial public offering (IPO) given the present scenario. It might consider that possibly two or three years later, Mr.Sarvesh Kumar said.

RRBEL, whose turnover was about Rs.550 crore in 2010-11, expects to increase it to Rs.800 crore in 2011-12. The company, which has a R&D facility in Sriperumbudur, was making headway in terms of foraying in to South America. The 1.8 MW WEG, according to D. Ramraj, Vice- President (R&D), is designed for low wind speeds and offers lot of safety features.

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