Mergers And Acquisitions Suzlon And Repower Marketing Essay

When Suzlon joined the global market in 1998, it turned out able to pick up a big talk about of the market almost immediately. There was a huge demand for wind generators as governments around the world looked for environmentally friendly alternative energy resources that would reduce reliance on hydrocarbon and coal structured power plants. There is a big shortage of suppliers on the market, and that proved helpful to its gain. Big brands such as GE and Denmark's Vestas AS were unable to fill in the demands. Suzlon could take this negative primarily.

In March 2006 Suzlon Blowing wind Energy agreed upon a definitive arrangement for the proper acquisition of Hansen Transmissions. Hansen Transmissions is a significant wind mill gearbox company with state-of-the-art developing facilities in Edegem and Lommel in Belgium. Hansen Transmissions International NV ("Hansen"), headquartered in Belgium has a solid R&D capacities and modern production facilities. Suzlon profits technological management from the integration of research and development, design and production to evolve the next generation of more reliable wind generators.

Suzlon Energy Small ("Suzlon") using its subsidiary, AE - Rotor Holding BV based in Netherlands inserted into definitive contracts to acquire Hansen Transmissions International NV, for EUR 465 million (RS 2511crores) organization value, in an all cash transaction.

Suzlon is a vertically built-in wind power company, having end-to-end solutions from assembly, assembly to commissioning. The company manufactures cutting blades, generators, sections, and towers in-house, as well as gearboxes through its partial ownership of Hansen Transmissions and state-of-the-art large or offshore turbines through its subsidiary REpower. Suzlon is integrated downstream and provides turnkey jobs through its task management and set up consultancy, and functions & maintenance services. Suzlon has office buildings, R&D and technology centers, processing facilities and service support centers spread across the globe.

Planning of Breeze Plantation Systems, Land Acquisition, Development and Technical Design, Infrastructure and Equipment, O&M services. Suzlon offers customers' end to end wind energy alternatives, including wind learning resource mapping, site development and installation, and finally operations & maintenance services in India. This allows Suzlon to provide Indian customers economies of scale, and eliminates the need for customer participation in the complex process of breeze plantation development.

The Electricity Function, 2003, specifies that a minimum percentage of power era should come from non-conventional energy resources. For instance, the Karnataka government has mandated 5% from non-conventional sources, and the Madhya Pradesh federal government 0. 5% This displays the government's motive of minimizing the reliance on fossil fuels and cut down carbon dioxide emission. Moreover, perennial electricity shortages assure a suffered growth in demand for power era.

Suzlon Energy is widening abroad, where major players have established markets. The good thing about new markets and new purchases might take time, while marketing, workers and other first costs could bounce. Hence, this might put strain on the margin in the short run. Risks involved with overseas business are also higher, Company is facing liquidity crunch to pay its debt recently promoters had sold their holding in the company. So expansion plan may further improve the burden on the company balance sheet.

Suzlon is in need of restructuring your debt around Rs 11, 800 crore which it raised for various nationwide & global acquisitions. The Company faces forex loss of practically Rs 435 crore because of that 500 million zero coupon convertible forex Convertible Bond (FCCB) which is still pending are anticipated in 2012. The knife retrofits and consequentially availability charges of nearly Rs 307 crore is another matter area and the 3rd is the mark-to-market MTM) lack of almost Rs 215 crore which is on account of foreign exchanges forwards options deal that your company has taken to hedge. These are the three important areas - the forex loss, cutting tool retrofits and MTM damage which can affect the company's profitability in coming time.

Probably, the largest problem for Suzlon is the fact that wind energy requires so much government support to be a viable market. Take away the sops or put the government stimulus behind other alternative sources of energy such as solar, the impact it will have on wind vitality companies will be devastating. Changes in Authorities policies in European countries during economical slowdown impacted Suzlon's progress in big markets.

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