Suzlon Energy, a prominent player in the renewable energy sector, has announced plans for a strategic restructuring aimed at enhancing operational efficiency and optimizing resources. The company’s board has approved the merger of Suzlon Global Services, a wholly-owned subsidiary, with itself, alongside the transfer of its project business through a slump sale to one or more wholly-owned subsidiaries.
Additionally, Suzlon will undertake a capital reorganization exercise through a Scheme of Arrangement, involving the reclassification and transfer of general reserves to the retained earnings of the company. This restructuring initiative also includes the merger of Suzlon Energy Mauritius, another wholly-owned subsidiary, with Suzlon Energy.
According to the company, these measures aim to strengthen Suzlon’s stand-alone balance sheet by consolidating major business segments within the listed entity. The strategic realignment is geared towards optimizing financial resources, enabling effective reinvestment in areas promising better returns.
The merger facilitates seamless integration of wind turbine generator (WTG) and operation and maintenance service (OMS) contracts under a single entity, eliminating inter-company balances and enhancing Suzlon Energy’s net worth at a standalone level.
Furthermore, Suzlon plans to manage project execution business and land activities through separate legal entities to improve control and operational efficiency.
The merger with Suzlon Energy Mauritius is expected to streamline the company’s overseas holding structure, enhancing transparency and reducing reporting/compliance requirements and associated costs.
Commenting on the restructuring, Suzlon emphasized its commitment to strategic financial management and operational excellence, aiming to position itself for sustained growth and value creation in the renewable energy sector. The proposed restructuring is subject to regulatory approvals and other customary closing conditions.