Suzlon eyes Senvion listing, loans

Suzlon could raise about €1bn ($1.34bn) by listing its Senvion turbine unit on the London Stock Exchange and borrowing against the German subsidiary, which will increasingly be the focus of the Indian wind group’s overseas ambitions, said chairman Tulsi Tanti.

Tanti said Suzlon will seek to list Senvion on the London Stock Exchange by next March, raising up to €500m in return for a 25% stake.

The Indian group may raise roughly the same amount of debt against Senvion, using the proceeds to refinance its parent group's more expensive Indian loans and cut Suzlon’s interest charges by 50% by the final quarter of its current 2015 financial year, which ends next March.

Tanti said financial restructuring, operational improvements and growing market share will leave the group able to post a net profit in the final quarter of the current 2015 financial year. In the first quarter it posted a net loss of 7.5bn rupees ($123m).

Speaking in a wide-ranging interview on CNBC TV 18, Tanti said Senvion will increasingly become the focus of the Suzlon group’s ambitions in global markets. "We are expanding its geography," said Tanti.

“The plan is they should start entering into emerging become a more global organisation.”

Tanti said the current priority for the Suzlon wind business is India, where he said recent favourable policy changes should allow the company to boost its market share to about 30% in the current financial year, up from 20% last year.

He played down a risk of market cannibalisation between the two, claiming the up-to-2MW-focused Suzlon range and Senvion with its larger turbines would both find favour. “The market needs both the product portfolios...and we’ll increase the collective market share,” said Tanti.

The Suzlon chairman presented an overall upbeat view of the group’s prospects, following several years of complex financial restructuring.

He said he expects the second half of the financial year will begin to show big improvements compared to the 2014 equivalent.