Japan’s SoftBank Group Corp.’s long-standing plan to sell its controlling stake in solar power producer SB Energy to Canada Pension Plan Investment Board (CPPIB) has been called off, said two people aware of the development.
The deal was in the works for around a year, with CPPIB placing several pre-conditions—also referred to as condition precedents (CPs)—for SoftBank before finalising the transaction.
These include meeting certain project commissioning deadlines, securing new businesses, bond issuance as well as SoftBank bearing any future liquidated damages liability for acquiring the stake as reported by Mint earlier. Each CP had a monetary component attached to it. “The deal has been called off, and an internal announcement to this effect has been made to employees of SB Energy,” said one of the two people, requesting anonymity.
SoftBank was planning to sell its entire 80% stake in SB Energy, which has a 7.7 gigawatts (GW) solar power portfolio in India, for an estimated $525 million. The remaining stake is held by Bharti Enterprises Ltd. Bank of America and Barclays were handling the sale process.
SoftBank invested more than $800 million in the business in the past five years. The stake sale efforts followed SB Energy dropping its plan in July 2020 to raise $600 million through a dollar bond. Mint reported on July 6, 2020, about SoftBank’s plan to sell its entire stake, in a shift from its earlier plan to find a significant minority investor, and its separate talks with CPPIB, Canada’s Brookfield Asset Management Inc., and Abu Dhabi’s sovereign wealth fund Mubadala Investment Co. for the sale.
{{/usCountry}}SoftBank invested more than $800 million in the business in the past five years. The stake sale efforts followed SB Energy dropping its plan in July 2020 to raise $600 million through a dollar bond. Mint reported on July 6, 2020, about SoftBank’s plan to sell its entire stake, in a shift from its earlier plan to find a significant minority investor, and its separate talks with CPPIB, Canada’s Brookfield Asset Management Inc., and Abu Dhabi’s sovereign wealth fund Mubadala Investment Co. for the sale.
{{/usCountry}}A CPPIB spokesperson said, “We continue to look for opportunities for new investments in India, including in the renewables sector, as part of our Sustainable Energy Group strategy. Since the start of 2021, we have announced an increased commitment to toll roads via IndInfravit, a new JV with RMZ in real estate and a private equity co-investment in animal health. CPP Investments is a major investor in India with Canadian $12 billion invested to date, and the country is core to our global, long-term investment strategy.”
Spokespersons for Bharti Enterprises, Bank of America and Barclays Bank India declined to comment. A SoftBank Group spokesperson declined to comment. Queries emailed to Raman Nanda, SB Energy’s CEO; and Rohit Modi, SB Energy’s country head and president-India remained unanswered till press time.