JSW Energy buys O2 Power for ₹12,468 crore – Its largest acquisition till date

JSW Energy on Friday announced the acquisition of O2 Power, a renewable energy platform, in a transaction valued at ₹12,468 crore, marking its largest acquisition since inception. The deal will significantly expand JSW Energy’s generation capacity by 23%, increasing it from 20,012 megawatt (MW) to 24,708 MW.

O2 Power’s renewable energy platform has a total capacity of 4,696 MW, with 2,259 MW set to be operational by June 2025, 1,463 MW currently under construction, and an additional 974 MW in the pipeline, scheduled for commissioning by June 2027. The platform operates at a blended average tariff of ₹3.37 per kilowatt (KWh), with a remaining life of 23 years. The capacities are spread across seven resource-rich states in India.

JSW Energy highlighted that the transaction includes the acquisition of O2 Power Midco Holdings Pte. Ltd. and O2 Energy SG Pte. Ltd. The deal is subject to the approval of the Competition Commission of India (CCI) and other customary regulatory approvals.

Sharad Mahendra, Joint Managing Director and CEO of JSW Energy, said, “We are thrilled to announce the acquisition of O2 Power’s 4.7 GW renewable energy platform, which is JSW Energy’s largest acquisition since inception. This landmark acquisition strengthens our positioning as a leading player in India’s energy sector. These high-quality assets strengthen our operational footprint across key resource-rich states.”

Mahendra added, “It gives me great joy to welcome the experienced management team and employees of O2 Power to the JSW Energy family. By combining our strengths, I am confident that we will deliver exceptional value to our stakeholders.”

On December 27, JSW Energy’s shares on BSE closed 1% lower at ₹629.85 apiece. The market capitalisation of the stock is ₹1.09 lakh crore. Its 52-week low is ₹404 and 52-week high is ₹804.9.

Pritesh Vinay, Director (Finance) and CFO of JSW Energy, said, “The acquisition of O2 Power’s renewable energy platform is significantly value accretive to the shareholders of JSW Energy. This is a very attractive acquisition – both from ‘Build vs Buy’ trade off as well as from a quality and value perspective when compared to all acquisitions in this space over recent times, and is consistent with our long track record of being prudent in capital allocation and focusing on high cash returns projects above our hurdle rate of mid-teen Equity IRR.”

The acquisition would help the company in achieving its renewable-led capacity growth target of 20 gigawatt (GW) before fiscal 2030, the company said in its statement.