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DLF to sell wind energy business for Rs 9 billion to BLP

According to reports, India’s biggest real estate group DLF will sell its wind energy business to an unlisted firm founded by the former General Electric India boss Tejpreet Singh Chopra for around Rs 900 crore, two people familiar with the matter said.

“The divestment of wind energy business has already been finalised with Bharat Light and Power (BLP). However, there are some regulatory issues that need to be resolved before announcing the transaction,” one of the persons, a DLF official who requested anonymity, told ET.

The second source said the deal’s contours involve DLF selling its windmills in Gujarat, Tamil Nadu, Karnataka and Rajasthan under a two-phased “slump sale”, which is industry jargon for a transaction in which an entire business is transferred for a lump-sum amount without assigning values to specific assets. DLF plans to first sell windmills that can generate up to 200 megawatts of power and have permission from state governments to transfer power purchase agreements. The second part involving assets that can generate another 28 MW of power will be sold later, the source added. Companies need the permission of state government for transferring PPA before they sell power generating assets.

Both DLF and Chopra, who founded BLP in 2010 after leaving GE where he was its president and CEO for India, Sri Lanka and Bangladesh, declined to comment. The sale will make it the latest in a string of disposals by DLF. Bharat Light and Power (BLP) aims to be a dominant player in the clean energy space in India and has a vision of producing 1 gigawatt of energy from a range of operating assets by 2015. A deal for DLF’s assets will help BLP gain cheap access to operating assets with existing cash flows.

The firm, which counts venture capital firms VenturEast and Draper Fisher Jurvetson among its investors, has begun discussions with private equity funds to raise capital from a different set of investors, a person familiar with its plans said. The two venture capital firms invested Rs 53 crore in 2011 to buy a minority stake.

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