TPG Capital, the global private investment firm, is in advanced level of talks with Luminous Power Technologies (P) Ltd--which makes inverters, appliances and batteries--for buying a significant stake in the battery maker, sources close to the development told VCCircle.
Although the discussions (with TPG) are at a fairly advanced stage, sources indicate that the company was also examining the possibility of floating an IPO if the private equity option falls through.
Luminous India, a part of the SAR Group, recently touched a turnover of Rs 1,000 crore. An email sent to Puneet Bhatia, heading TPG's investments in India, did not elicit any response at the time of writing this article. "TPG is not in talks with us for majority stake," Rakesh Malhotra, CEO, SAR Group told VCCircle. Malhotra added that they have held preliminary talks with the company and there is no clarity yet of a deal.
Luminous Power makes products for home and commercial applications. It caters to telecom infrastructure & renewable energy systems like solar, wind and hybrid solutions. Founded in 1988, the group has revenue exceeding $250 million in FY 2009-10 and projected to be $500 million by FY 2010-11.
The Delhi-based firm has raised institutional funding in the past. It landed a funding of $20.3 million from CLSA Capital Partners in 2007. It has also been fairly active on the M&A front. In 2009, it acquired a majority stake in Tritronics (India) Pvt. Ltd., a Delhi based on-line UPS company for an undisclosed sum. It also acquired a majority stake of 87.5% in UD Energy Systems the same year.
The energy storage industry has seen action from PE investors in the past. In 2006, Sukam, a Delhi-based rival of Luminous, received $10 million in funding from Reliance India Power Fund - a $200 million private equity fund sponsored jointly by Anil Dhirubhai Ambani Group and Singapore-based Temasek Holdings (Temasek). They picked up 20% in the company, which had revenues of Rs 200 crore then.
The group businesses include power backup, storage, distributed power generation, renewable & alternate energy solutions and physical infrastructure solutions for IT & telecom, engineering design & support services, plug-in hybrid electric vehicles and mobile phones & accessories. Luminous enjoys a foothold in over 32 countries. Its global technology centers are located in India, US & China.