Mumbai: Varun Beverages Limited (VBL) has approved an investment of up to Rs 4.10 crore to acquire up to 26 per cent equity stake in Jager Renewables Private Limited, strengthening its push towards renewable energy and lower power costs.
The company's Investment and Borrowing Committee approved the proposal at its meeting on October 7. The investment will help VBL obtain solar power for captive consumption at its facilities in Uttar Pradesh.
Solar Power For UP Plants
Jager Renewables is a special purpose vehicle incorporated in September 2020 under the group captive model. It has been set up to generate and supply solar power to consumers in Uttar Pradesh and is yet to begin operations.
VBL plans to source solar power from Jager Renewables for its facilities in Gorakhpur and Prayagraj, as well as any new facility established in Uttar Pradesh.
The company said solar power is environment-friendly and is also expected to reduce electricity costs at these facilities. Under the Electricity Act, VBL is required to invest in the company as a captive user.
Rs 4.10 Crore Investment
The proposed investment will be made in cash in one or more tranches. Once completed, VBL will hold up to 26 per cent of Jager Renewables' equity share capital.
The transaction is expected to be completed on or before October 6, 2027. No government or regulatory approval is required for the acquisition, according to the company's disclosure.
No Related-Party Link
VBL said the proposed investment does not qualify as a related-party transaction. Its promoter, promoter group and group companies have no interest in Jager Renewables apart from the proposed investment through VBL.
The investment is aimed at securing captive renewable electricity while bringing down power costs at VBL's Uttar Pradesh operations.
Disclaimer: This article is based on information disclosed by Varun Beverages Limited in its regulatory filing with the stock exchanges.
