Wind energy major Suzlon announced on Tuesday that it has entered into a sale and leaseback agreement of its corporate headquarters, One Earth, in Pune.
In an announcement to the stock exchange, the company said it sold the property for ₹440 crore ($52.5 million) to OE Business Park Pvt. Ltd., a special purpose vehicle, shares of which are held by funds managed by 360 ONE Alternates Asset Management.
The deal, formalized on Tuesday, involved leasing back the office space for up to five years with subleasing and licensing rights, allowing Suzlon to continue operations while monetizing the asset.
The move is part of the company’s broader growth strategy of turning asset-light and unlocking capital to fund the execution of its expanding order book with internal resources.
This sale and leaseback arrangement is not expected to impact Suzlon’s operations, and the company can optimize lease costs by sub-leasing or licensing part of the property.
“This was something which has been on the anvil for quite some time in the company. Finally, we decided to enter into this transaction to fund the core business of our company,” said Himanshu Mody, chief financial officer of Suzlon, in the statement.
Under the terms of the agreement, Suzlon will continue to occupy the property as a lessee. Suzlon has also entered into an option agreement to buy the shares and securities of OEBPPL at a future date.
A sale and leaseback deal can be a powerful financial strategy for a company looking to release capital tied up in its assets.
