Milbank Advises Lenders on Green Loan to Finance the US$736M Acquisition of REC Solar Holdings

Milbank LLP advised the lenders in relation to the green loan to finance the US$736 million acquisition of Norwegian-headquartered solar panel maker REC Solar Holdings by Reliance New Energy Solar Ltd, a wholly owned subsidiary of Indian conglomerate Reliance Industries Limited. REC Solar Holdings was acquired from China National Bluestar, the specialty chemicals and materials company.

The acquisition of REC Solar adds significant solar capacity for Reliance Industries as it seeks to become net carbon zero by 2035, while making India a hub for low-cost solar manufacture. The transaction also accelerates Reliance Industries’ expansion in Australia, Europe, the United States and more widely in Asia. In India, Reliance plans to use REC’s technology at Dhirubhai Ambani Green Energy Giga Complex on 5,000 acres in Jamnagar. Initially, the complex will begin with a 4GW per year capacity and eventually grow to 10GW annually.

The five lending banks were ANZ, Credit Agricole, DBS Bank, HSBC and MUFG. The financing comprises a US$250 million six-year term loan, a US$150 million working capital facility and a US$336 million five-year bank guarantee facility.

The Milbank deal team was led by Global Project, Energy & Infrastructure Finance partner John Dewar with special counsel Munib Hussain and associate Bader Thabti.

Commenting on the transaction, Mr. Dewar said: “This is a complex financing in line with Reliance Industries’ ‘new energy vision’ to become a global scale photovoltaic (PV) manufacturing competitor and as part of its energy transition plans. The acquisition of REC will help Reliance Industries with a ready global platform and the opportunity to expand and grow in key green energy markets globally, including in the United States, Europe, Australia and elsewhere in Asia. Furthermore, the green loan financing represents the first green financing entered into by Reliance Industries and a significant green financing for Milbank as we head towards the end of the year.”