Renewable energy firm Fotowatio Renewable Ventures (India) Pvt Ltd, hereby known as FRV, has raised up to US$29 million from International Finance Corporation (IFC) through non-convertible debentures (NCDs).
According to a disclosure, IFC said that it will be subscribing to NCDs up to US$29 million and mobilization of up to US$58 million. NCDs are unsecured bonds that cannot be converted to the company’s equity or stock.
The company will most likely use the capital to fund its scheduled 2017 project of building two 50 MW solar photovoltaic plants in Andhra Pradesh. The project is estimated to cost US$119 million and will be funded through a mix of 75 percent debt and 25 percent equity.
This project comes as part of the government’s National Solar Mission program which is aimed to achieve 100 GW of installed solar capacity in the country by 2020.
For the Spanish firm Fotowatio Renewable Ventures B.V., this is the firm’s first-ever solar auction in India. After implementation, the solar plant will be able to meet the electrical needs of around 35,000 average homes.
FRV is a leading global developer of utility-scale photovoltaics solar power plants and operates as part the Abdul Latif Jameel (ALJ) group in Saudi Arabia. The global solar development company has a portfolio of 1GW across emerging solar markets like Australia, the Middle East, Africa and Latin America.
It has a list of backers which include IFC, the Dutch Development Bank (FMO), the Europe Arab Bank, European Bank for Reconstruction and Development (EBRD), as well as the Society for the Promotion and Participation for Economic Cooperation (PROPARCO).
Since January this year, IFC has committed funds to three renewable energy firms. Apart from FRV India, the venture capital has also made a US$15 million investment to renewable energy company Clean Max Enviro Energy Solutions and a US$125 million investment in lieu of an equity stake in Hero Future Energies, the renewable energy arm of the Hero Group.
By Vivian Foo, VCNewsNetwork