Suzlon to sell Chinese subsidiary to CPNE

Suzlon Group has signed a binding agreement with China Power (Tianjin) New Energy Development Company Limited (CPNE) to sell its ownership in its wholly owned China manufacturing subsidiary, Suzlon Energy Tianjin, for Rs3.4bn ($60m).

The company has sold, under the agreement, majority of its assets and liabilities.

The transaction is a part of the company’s strategy to sell its non-critical assets and to use the net proceeds for long term debts.

Suzlon Group chairman Tulsi Tanti said the dynamics of the wind energy market have changed considerably over the past year, and the company is realigning its strategy to the China market with an agile, asset light business model to achieve the high growth and margins but with lower investments.

"This is also in line with our previously announced strategy to dispose of non-critical Group assets to reduce our long-term debt," Tanti said.

"Looking ahead, we will approach this market by combining development with an innovative partnership model."

Suzlon and CPNE signed the binding agreement on 22 June 2012 and the final sale is subject to the approval of all the regulatory requisites.

The company has installed over 900MW of wind capacity in China since the set-up of its wholly owned subsidiary in the country.

The company will complete all of its existing customers and contract obligations in China.

India based Suzlon Energy is a wind power company.