SCHEDULE: CPPIB-Led Consortium Sweetens ReNew Energy Buyout Bid

A consortium including Canada Pension Plan Investment Board has submitted a revised, best and final non-binding proposal to acquire ReNew Energy Global plc for $8.15 per share in cash.

Summary

• Canada Pension Plan Investment Board (CPPIB) and a consortium have submitted a revised, best and final non-binding proposal to acquire all outstanding Class A ordinary shares of ReNew Energy Global plc not already owned by the consortium for US$8.15 per share in cash.
• The revised offer represents a 29% premium to the closing share price of $6.34 on December 10, 2024, and a 41% premium to the 30-day volume-weighted average price of $5.76 as of December 10, 2024.
• The consortium, which includes CPPIB, Platinum Hawk C 2019 RSC Limited, Abu Dhabi Future Energy Company PJSC-Masdar, and Founder Sumant Sinha, aims to announce a binding transaction in November 2025.
• CPPIB beneficially owns 88,846,844 Class A ordinary shares, representing 34.6% of the voting rights, as of March 31, 2025.
• Due diligence is largely complete, with only confirmatory legal and tax items remaining, and significant progress has been made on the Transaction Agreement.
• The transaction is proposed to be implemented through a UK scheme of arrangement, with an indicative timeline suggesting completion within 7-8 months of signing and a long stop date of 12 months.
• The proposal includes plans for the redemption of all company warrants at their Black-Scholes Value and material agreement on ESOP and compensation plans for the Founder and CEO, with details for broader management in the draft Transaction Agreement.

Sentiment

Score: 8

Explanation: The sentiment is highly positive due to a significantly increased, 'best and final' acquisition offer that provides a substantial premium to shareholders and indicates a clear path towards a binding transaction. The completion of due diligence and progress on documentation further support a positive outlook for the deal's closure.

Positives

• The revised offer price of US$8.15 per share provides a significant premium of 29% over the closing share price on December 10, 2024, and 41% over the 30-day VWAP, offering immediate liquidity and value certainty to shareholders.
• Due diligence is substantially complete, indicating a clear path forward with no material outstanding items.
• Significant progress has been made on the Transaction Agreement, suggesting a streamlined negotiation process towards definitive agreements.
• The consortium's commitment to a 'best and final' offer demonstrates strong intent to close the transaction.

Negatives

• The proposal is non-binding until definitive agreements are executed, introducing a degree of uncertainty regarding the transaction's ultimate completion.
• The appointments of all independent directors are expected to be terminated upon or shortly after the completion of the transaction, which could impact corporate governance structure.

Risks

• The proposal is non-binding and contingent on the execution of definitive agreements, meaning the transaction may not proceed as outlined.
• Completion of the transaction is subject to various conditions precedent, including receipt of regulatory approvals in multiple jurisdictions, shareholder approval, and sanction by the UK Court.
• There is a risk that the company may not obtain the necessary consent solicitation to amend its warrant agreement, potentially requiring a tender offer to reduce outstanding warrants.
• The company needs to obtain certain approvals related to its existing financings and other agreements, which could be a hurdle to completion.
• The warranties from the company must remain materially true and accurate, and the company must not be in material breach of its obligations under the Transaction Agreement.

Future Outlook

The consortium aims to work towards the announcement of a binding transaction in November 2025. The proposed transaction is expected to be implemented through a UK scheme of arrangement, with an indicative timeline suggesting regulatory approval filings within 4 weeks of signing, SEC submissions within 6 weeks, shareholder meetings within 15-16 weeks, and overall completion within 7-8 months, with a long stop date of 12 months.

Management Comments

• The Consortium believes that its revised proposal, which would provide shareholders with immediate liquidity and value certainty not available in public markets, would be in the best interest of the Company and its shareholders.
• The Consortium trusts that the revised proposal evidences its willingness to take the Transaction forward to the next stage.
• The Consortium sees a clear path to a mutually agreeable Transaction and would like to work towards the announcement of a binding Transaction in November 2025.

Industry Context

This proposed acquisition reflects a broader trend of consolidation and private investment interest in the renewable energy sector, particularly in emerging markets like India where ReNew Energy Global operates. Large institutional investors and sovereign wealth funds are increasingly seeking to acquire established renewable energy platforms to capitalize on global decarbonization efforts and stable, long-term asset returns. The take-private nature of this transaction allows the consortium to gain full control and potentially implement long-term strategies away from public market pressures.

Comparison to Industry Standards

• The filing does not provide specific comparisons to other companies, projects, or industry benchmarks regarding the valuation or operational performance. The premium offered is relative to ReNew Energy Global's own historical share prices.

Management Changes

Corporate Governance

Related Party Transactions

• The proposed acquisition is a related party transaction as the Consortium members, including Canada Pension Plan Investment Board and Founder Sumant Sinha, are existing shareholders of ReNew Energy Global plc and are proposing to acquire the shares not already owned by them.

Stakeholder Impact

• Shareholders: Will receive immediate liquidity and a significant premium (29% to closing price, 41% to VWAP) for their shares, offering value certainty.
• Independent Directors: Their appointments will be terminated upon completion of the transaction.
• Employees/Management: Material agreement has been reached on ESOP and compensation plans for the Founder and CEO, with similar plans for the broader management team included in the draft Transaction Agreement, indicating retention and incentive structures.

Next Steps

• Consortium advisers will share an updated draft of the Transaction Agreement with Linklaters.
• Consortium members will seek final internal approvals once alignment on the Transaction Agreement is confirmed.
• Work towards announcing a binding Transaction in November 2025.
• Company to launch a consent solicitation process to amend its warrant agreement for redemption at Black-Scholes Value.
• Company's articles will need to be amended to allow the Consortium to acquire shares issued from warrant exercise at the offer price.
• The transaction will proceed through a UK scheme of arrangement, involving regulatory approval filings, SEC submissions, scheme document publication, company shareholder meeting, and UK Court sanction.

Key Dates

Recommendation

The revised offer of $8.15 per share represents a substantial premium over recent trading prices and is explicitly stated as the 'best and final' non-binding offer. For existing shareholders, holding the stock is advisable to realize the acquisition price upon completion, assuming the deal closes as expected. For new investors, there might be a small arbitrage opportunity if the market price is below $8.15, but the primary recommendation for existing holders is to hold for the deal's completion.

Keywords

ReNew Energy Global, CPPIB, Acquisition, Buyout, Renewable Energy, India, Schedule 13D, Offer Price, Premium, Scheme of Arrangement, Corporate Governance