JSW Energy’s wholly-owned subsidiary JSW Neo Energy on Friday signed an agreement to acquire a 4,696-megawatt (MW) renewable energy portfolio from O2 Power Pooling, a platform jointly established by EQT Infrastructure and Temasek.

The transaction values the platform at an enterprise valuation of around ₹12,468 crore ($1.47 billion), after adjusting for net current assets, the power producer says in a statement.

The acquisition, expected to be completed on or before May 26, 2025, would help the JSW Energy in achieving its renewable-led capacity growth target of 20 gigawatt (GW) before 2030.

The transaction entails acquisition of O2 Power Midco Holdings and O2 Energy. It is subject to approval of the Competition Commission of India (CCI).

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 ₹3.37 per kilowatt-hour with remaining life of around 23 years. O2 Power's revenue from operations 2023-24 stood at ₹538 crore.

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

“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,” says Sharad Mahendra, joint managing director and CEO of JSW Energy.

"These high-quality assets strengthen our operational footprint across key resource-rich states. It gives me a great joy to welcome the experienced management team and employees of O2 power to JSW Energy family. By combining our strengths, I am confident that we will deliver exceptional value to our stakeholders," adds Mahendra.

The renewable energy platform boasts a majority of the capacity tied-up under long-term power purchase agreement (PPA) with quality off-takers with high credit rating.

“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,” says Pritesh Vinay, director (Finance) and CFO of JSW Energy.

“This gives us an opportunity to leapfrog our growth ambitions. JSW Energy remains focused to pursuing value-accretive opportunities that support our ambitious growth objectives in the power sector,” adds Vinay.