Danish wind turbine manufacturer Vestas Wind Systems A/S (CPH:VWS) is holding discussions to buy a controlling stake in Indian peer Suzlon Energy Ltd (BOM:532667), CNBC-TV18 reports.
Sources privy to the developments have told the news channel that Vestas is negotiating a deal that will involve buying the 17.6% stake in Suzlon held by promoter Tulsi Tanti and his family, as well as the 23% interest held by investor Dilip Shanghvi.
Once it buys those stakes, the Danish firm plans to kick off an open offer for further shares. Talks are at a serious stage, according to the report.
The reason why Suzlon’s investors are considering such a transaction is the fact that the company has piled up over INR 70 billion (USD 984m/EUR 868.4m) of debt, the news channel said.
Neither Vestas nor Suzlon wished to comment on market speculation when contacted by CNBC-TV18, though a representative of the former noted that it is open to bolt-on acquisitions.
Suzlon responded to a request for clarification from the Bombay Stock Exchange by saying that it is exploring multiple options for debt reduction along with its lenders. It did not give further information.
(INR 10 = USD 0.141/EUR 0.124)
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