KKR, Hero Group put $450 mn equity investment in Hero Future Energies

Hero Future Energies (HFE), the renewable energy company led by Rahul Munjal, bagged an investment of $450 million from US-based investment firm KKR and parent Hero Group. According to company executives, this is an equity investment.

In a statement, the two companies said they have signed definitive agreements under which KKR and the Hero Group will invest $450 million in HFE. The company did not reveal individual amounts put by the two groups.

“This investment will position HFE for continued growth and support its efforts to expand its renewable energy capacity. It would also enhance capabilities across technologies such as solar, wind, battery storage, and green hydrogen, and into new markets over time,” said the statement.

The investment in HFE is also aimed at supporting the two investors in their efforts to decarbonise and transition towards sustainable energy sources to achieve their net-zero emission goals, said the statement.

“HFE’s clean energy solutions play an important role in helping companies decarbonise as energy demands continue to grow.

We look forward to working closely with HFE’s management team and existing investors, including the Hero Group and International Finance Corporation (IFC). This would help HFE achieve its next phase of growth and contribute to the energy transition efforts in India and globally,” said Hardik Shah, partner at KKR.

In 2019, HFE reorganised its business to expand its portfolio abroad and access cheaper funding.

Hero Future Energies Global (HFE Global), registered in London since 2016, was made the controlling entity for the India business through a Singapore firm to spearhead its global plans. The move is aimed at exposing HFE Global to better financing avenues in the global market.

In December 2019, HFE raised $65 million from the Asian Infrastructure Investment Bank for this project. In November 2019, Abu Dhabi Future Energy Company (Masdar) invested $150 million into Hero Future Energies. This was followed by another round of strategic investment by the IFC, which pumped $90 million into the Indian company. IFC had earlier invested $125 million in 2017. The company also raised green bonds in the overseas market in 2021 for which it received orders worth $3 billion.

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