JSW Energy shares jump over 7.5% as arm acquires 4.7 GW renewable energy platform O2 Power; check the enterprise value

The transaction entails the acquisition of O2 Power Midco Holdings Pte Ltd and O2 Energy SG Pte Ltd and is subject to approval by the Competition Commission of India (CCI) and other customary approval standards for a transaction of this size, a company statement said.

It stated that the transaction has an enterprise valuation of about ₹12,468 crore after adjusting for net current assets.

The enterprise value measures the value of a company’s operations to all stakeholders, including equity and debt capital providers. Hence, the enterprise value is considered a capital structure-neutral metric. In other words, enterprise value calculates the potential cost to acquire a business based on the company's capital structure.

O2 Power is a renewable energy platform with a capacity of 4,696 MW—where 2,259 MW will be operational by June 2025, 1,463 MW is currently under construction, and an additional 974 MW are in the pipeline—all scheduled for commissioning by June 2027.

The platform has a blended average tariff of Rs 3.37/KWh with a remaining life of 23 years.

The capacities are spread across seven resource-rich states of the country. This acquisition will leapfrog the company's locked-in generation capacity by 23%, from 20,012 MW to 24,708 MW.

In a separate development, JSW Energy on Friday announced that its board has approved the appointment of Feby Koshy as the executive vice president and head of thermal.

His appointment is effective from December 30, JSW Energy said in an exchange filing.

Shares of JSW Energy have rallied over 50% in the past year.