Energy & Infrastructure M&A 2025 Comparisons

The deal space in FY 2024–25 in India has been resilient against the backdrop of global policy uncertainty, the ongoing US tariff impositions, geopolitical unrest and other macroeconomic factors, including valuation concerns due to inflationary trends. However, there has been an overall improvement in deal volume compared to the previous financial year, as India has witnessed a shift towards high-value strategic transactions in certain sectors – in particular, green energy (solar, wind and green hydrogen), oil and gas, and sustainable mobility. India’s commitment to green energy transition at the COP26 in Glasgow (with a goal of 50% of its energy demands to be met through renewable sources by 2030), the ever-increasing energy demands, and the infrastructure requirements of a developing economy have led to sector-focused inbound investments of significant deal value.

Meanwhile, the sharp build-out in domestic renewables – with falling solar equipment costs translating into competitive tariffs – has continued to enable portfolio aggregation and platform-level transactions. The government’s continued pro-business regulatory reforms, the sector-focused liberalisation of the foreign direct investment (FDI) regime, and the introduction of schemes such as the production-linked incentive (PLI) scheme continues to drive inbound investment decisions and the value chain around these sectors.

During the past 12 months, large Indian energy firms have emerged as dominant entrants in the renewable energy space, intending to diversify their portfolio. In 2024–25, ONGC NTPC Green (joint venture of ONGC and NTPC) acquired Ayana Renewable Power, and ONGC Green acquired PTC Energy’s 288 MW wind assets. In April 2025, JSW Neo Energy acquired a 4.7 GW renewable platform from O2 Power (backed by EQT and Temasek).

India’s energy space has also witnessed significant exits, such as Fortum Oyj and Statkraft exiting the Indian energy market and developers such as Enel Green Power negotiating their exits. However, this has been contrasted by strategic partnerships – for example, Singapore-based Sembcorp, through its Indian subsidiary, entered into a landmark joint venture with BPCL for the development of green hydrogen projects in India.

Overall, India’s clean energy sector continues to witness significant investment activity. This is down to the steady progress towards the target of achieving 500 GW of non-fossil fuel-based capacity by 2030 (committed to as part of India’s Panchamrit goals introduced at the COP26 in Glasgow, UK).

In India, regulatory considerations for both the energy sector and the infrastructure sector ‒ as well as sectoral challenges and local-level experience ‒ are factors that drive investor entry-decisions. Investors usually adopt a mix of financial instruments (in the form of equity, debt or hybrid instruments) to access the energy and infrastructure M&A market in India. These investments are increasingly becoming more strategic, as investors seek to protect themselves against developmental and execution-level risks and the regulatory challenges in each sector by using clear mitigation strategies or through valuation adjustments.

Although investors do adopt structures (especially in platform-based transactions) whereby certain execution- or project-level risks are assumed by the investors along with the company, it is not common, particularly in certain energy and infrastructure subsectors that are highly regulated or have localised execution-level challenges. Even in the case of joint ventures, foreign participation is largely strategic and often involves sharing of technical know-how rather than ground-level execution.

The Indian energy and infrastructure M&A market has witnessed participation from a broad spectrum of investors, such as institutional investors, private equity funds, pension funds, multilateral agencies, and sovereign wealth funds seeking to enter specific energy and infrastructure sectors through Indian partners. However, private equity and infrastructure funds continue to remain among the most active.

Government-backed infrastructure-focused funds have also played a crucial role in recent times. NIIF, with platforms in renewables and smart metering, is a notable example in this category.

India’s pipeline of energy and infrastructure projects is increasingly defined by very large-scale renewable developments alongside select conventional power projects that contribute to the energy mix. In the context of renewable energy, there is a strong push towards gigawatt-scale solar and wind projects, as well as integrated facilities combining manufacturing, storage, and green hydrogen. These are complemented by medium-scale projects in the 300–600 MW range under central and state tenders, which form the bulk of annual capacity additions. Conventional projects remain fewer in number, ranging from 1 GW to over 10 GW capacity, particularly in thermal energy.

India’s oil and gas sector is presently undergoing significant development, with a plan to expand the city gas distribution network to 33,500 km and consequently increase natural gas’ share to 15% in the energy mix.

In terms of installed capacity, as of June 2025, non-fossil-fuel-based sources contribute about 49% of the total energy mix. Meanwhile, thermal power continues to remain dominant as India continues to transition towards its decarbonisation goals.

In India, most infrastructure projects are developed through the PPP mode under the competitive bidding route, which allows only limited foreign participation – either by way of a joint venture or consortium. Each sector is also considerably regulated, with most sectors having sectoral regulators. Therefore, entrepreneurs (particularly project developers and manufacturers) are advised to incorporate in India.

It is very common in India for entrepreneurs and investors in the energy and infrastructure industry to establish early-stage ventures through the private limited company route. Project developers frequently set up private limited companies or special purpose vehicles, as lenders and regulators prefer a ring-fenced structure for financing and compliance.

Early-stage financing for energy and infrastructure sectors (typically provided in the form of equity, debt-equity or convertible instruments) is largely dependent on the specific subsector, given that the challenges and the regulatory regime differs across the subsectors. Therefore, primary capital can be raised from local investors, promoters of family offices, government-sponsored funds, etc, or a combination of these sources. In more recent times, foreign private equity funds (through their Indian arm) have financed new companies in the energy and infrastructure sectors.

Debt capital is also a critical source of funding, especially, for companies formed to execute energy and infrastructure projects. Most concession agreements prescribe a debt-to-equity ratio of 70:30 and project financing is commonly availed by such companies to fulfil this requirement.

Preferred Mode

Although investors usually leave all options open for an exit (including through IPOs), the form of exit traditionally preferred in the energy and infrastructure sectors has been through secondary sales. This decision is guided by certain key factors – value optimisation of the business, macro-market conditions, investor sentiments vis-à-vis the economic factors, etc. Nevertheless, the cyclical nature of the business has been a key determinant for the choice of exit through secondary sales. In recent times, however, government-backed renewable energy companies have been seeking to raise capital through the public markets.

Transaction Structures

A typical transaction structure for the sale of a privately held energy and infrastructure company that has private equity or institutional investors may include:

• a sale of the entire company or controlling interest;
• a partial exit for the founders/promoters; or
• the founders/promoters continuing to hold a reduced stake in the company along with being involved in the operations of the company.

Form of Consideration

Most M&A transactions in the Indian market are generally structured as pure cash deals, especially in transactions involving financial buyers. However, the specific structure can vary based on factors such as the business of the company, industry considerations, and the strategic goals of the acquisition. A combination of cash and stock ‒ albeit not prevalent in the Indian market – may be opted for rather than the sale of the entire company for cash or a stock-for-stock transaction, as this combination allows the sellers to receive immediate liquidity through cash while also retaining an interest in the company through buying shares in the buying entity.

Key Considerations

For founders and investors, the decision to sell the entire stake or a controlling interest is typically linked to various factors, including return on investment, the fund’s life cycle, ownership structure in the company, and available exit option (eg, an IPO listing or similar liquidity events). Specifically for founders or promoters, it also important to carefully negotiate the liability allocation and determine the form of consideration.

Founders are typically expected to provide broad representations, warranties and indemnities covering tax, litigation, employee and environmental matters, whereas investors generally limit their obligations to title and authority over their shares. The use of representations and warranties insurance, while still relatively new in India, is gradually emerging in larger or sponsor-led deals to mitigate risk.

Spin-offs are becoming increasingly customary in India’s energy and infrastructure sector. In the past year, a few companies have demerged their energy business into a separate legal entity – for example, Siemens Limited, Sterlite Power Transmission Limited, GE India Industrial Private Limited and INOX Green Energy Service Limited.

In India, spin-offs can be undertaken either by way of a demerger through a scheme of arrangement approved by the competent authorities and/or the tribunal or through a contractual arrangement in the form of a business transfer or asset transfer.

Companies engaged in the business of energy and infrastructure often pursue spin-offs to:

• enhance value creation since independent entities attract more focused investment;
• improve operational efficiency;
• mitigate risk by managing the overall corporate risk; and
• offer a business structure that is attractive for potential mergers or acquisitions, creating opportunities for strategic partnerships.

Spin-offs in India can potentially be structured as tax-free transactions both at the corporate level and the shareholders’ level if spin-offs are being undertaken by way of a scheme of arrangement. Business combinations that involve the transfer of capital assets – for example, amalgamations and demergers – can be tax-neutral transactions, as they are exempted from taxation on capital gains under the Income Tax Act 1961 (the “IT Act”).

Such spin-offs must meet the following key requirements.

• The entity initiating the spin-off must be a demerging company and the assets and liabilities must be transferred to the resulting company.
• The assets and liabilities of the demerging company must be transferred to the resulting company on a going-concern basis.
• The resulting company must issue its shares to shareholders of the demerged company on a proportionate basis as consideration.
• Shareholders should retain a substantial interest in the resulting company by holding at least 75% of the value of their interests in the demerging company in the resulting company.

In India, a spin-off immediately followed by a business combination is possible; however, it must be in compliance with the regulatory framework under the Companies Act 2013 (the “Companies Act”) and approved by the Securities and Exchange Board of India (SEBI) and the Competition Commission of India (CCI), if applicable. Key requirements for undertaking a business combination after spin-offs are as follows.

• The board of directors of the company must approve the spin-off and the subsequent business combination. Shareholders’ approval is typically required if there are significant changes in shareholding patterns or corporate structure.
• An independent fairness opinion must be obtained to ensure that the terms of the business combination are fair to shareholders.
• Detailed schemes of arrangement for both the spin-off and the merger need to be drafted, outlining the terms and conditions, share exchange ratios, and other pertinent details.
• Schemes for spin-offs and business combinations must be filed with the National Company Law Tribunal (NCLT) (ie, the quasi-judicial authority for all company law matters) for approval.
• Listed companies must comply with stock exchange regulations regarding disclosures and approvals.

However, in a business combination through contractual arrangement in the form of a business transfer or asset transfer, approvals from regulatory authorities such as SEBI or CCI may be necessary.

Spin-off undertaken by way of a scheme of arrangement has been reported to be a time-consuming process and the approval process typically takes between six and eight months. However, the timeline for spin-offs undertaken by way of business transfer or asset transfer agreements are case-specific and typically take between two and four months.

The SEBI (Substantial Acquisition of Shares and Takeovers) Regulations 2011 (the “Takeover Regulations”) govern the acquisition of voting shares or voting rights or control in a listed company.

Any person ‒ with or without holding any shares in a target company ‒ can make an offer to acquire shares of a listed company, subject to minimum offer size of 26%. That said, the promoters or the promoter group typically control the board of listed companies, and it is difficult to successfully implement an open offer in the absence of any agreement with the promoters. From a practical standpoint, the acquisition of shares through the execution of share subscription or share purchase agreements with the promoters of the listed company and the open offer process are typically conducted as a simultaneous process.

In the context of the reporting requirements under the Takeover Regulations, if the acquisition in the first instance crosses 5% of the voting shares/voting rights in the listed company, the acquirer is required to make a disclosure of its holding and of the persons acting in concert (PAC) with such acquirer to the stock exchanges and the listed company. An acquirer (along with the PAC) already holding 5% or more of voting shares/voting rights is required to disclose any change in their shareholding exceeding 2% of voting shares/voting rights. These disclosures must be made to the stock exchanges within two working days of such acquisition or change.

The Takeover Regulations do not obligate the acquirer acquiring a stake in a listed company to publicly disclose the purpose of the acquisition or the intent regarding the acquisition with regard to the company. However, if the mandatory open offer (MOO) requirement is triggered (as discussed in 4.2 Mandatory Offer), the material portions of the acquisition ‒ including the reasons for the acquisition, the commercial reasoning (long-term) and strategic plans ‒ must be provided in the offer document.

Under the Takeover Regulations, an acquirer (along with PACs) is required to carry out a MOO in the following instances (both direct and indirect).

• If the acquirer (along with PACs) holds less than 25% of the total voting shares/voting rights of a listed company and acquires or agrees to acquire such number of voting shares/voting rights, which results in such acquirer (along with PACs) holding 25% or more of the voting shares/voting rights of the listed company.
• If the acquirer (along with PACs) already holds between 25% and 75% of the total voting shares/voting rights of a listed company and acquires or agrees to acquire such number of voting shares/voting rights, which results in such acquirer (along with PACs) holding 5% or more of the voting shares/voting rights of the listed company, in any financial year.
• Notwithstanding the acquisition of voting shares/voting rights, if any acquirer or its PACs acquire control of a listed company.

Acquisition of a public company is typically structured in either of the two forms:

• share acquisition for cash (either primary or secondary) up to the mandatory takeover thresholds as discussed in 4.2 Mandatory Offer, followed by an open offer; and
• merger through the merger scheme route, typically structured as a share swap requiring an approval from the NCLT.

Under the merger scheme route, a minimum of 75% of the shareholders of the merging entity are required to receive their consideration in the form of shares. In the event of a failure to meet this criterion, the transaction leads to tax implications in the hands of the recipient receiving the consideration.

Further, no approval of the shareholders of the listed company is required in the event of a share acquisition for cash. However, the merger scheme requires the approval of 75% of shareholders, and an additional minority shareholders’ approval in a few select cases.

Particularly in the case of energy and infrastructure companies, the acquisition of public listed companies is also structured as a business transfer whereby the acquirer and the listed company enter into a bilaterally negotiated business transfer agreement to purchase the listed company’s business or certain identified undertakings. Another structuring option is that of demerger, which involves demerging the business of the listed company in favour of the acquirer in consideration for shares to be issued by the acquirer to the shareholders of the listed company. From a regulatory perspective, the demerger scheme and its process is similar to a merger scheme as discussed earlier.

Business transfers do not trigger the MOO obligations but require the approval of 75% of the shareholders and a separate approval from the minority shareholders. Business transfers are prone to tax implications and therefore should be structured with caution to ensure the least tax incidence for the parties involved.

As discussed in 4.3 Transaction Structures, the acquisition of a public company is commonly structured as an acquisition-for-cash transaction. In certain instances, transactions also structured as partly stock and partly cash deals – although this is rare.

Minimum Price Requirement

In the context of pricing, other than in specific instances (eg, if acquisitions are undertaken through the exchanges or if the transaction is regulated under the extant foreign exchange laws), pricing is not typically regulated for acquisitions which trigger a MOO.

However, the Takeover Regulations prescribe the minimum price requirement for the price at which an offer in the MOO can be made. This price is to be determined as the highest of the following parameters:

• negotiated price per share of the underlying acquisition attracting the MOO;
• volume-weighted average price paid or payable for acquisitions by the acquirer (and its PACs) during the 52 weeks immediately preceding the date of the public announcement;
• price paid or payable for any acquisition by the acquirer (and its PACs) during the 26 weeks immediately preceding the date of the public announcement; or
• volume-weighted average market price of such shares, during the 60 trading days immediately preceding the date of the public announcement, if the listed company’s shares are frequently traded.

In a merger or demerger transaction, the pricing is determined based on the valuation report of the entities involved. In context of a business transfer, although the pricing is not per se regulated, the determination of pricing is commonly based on tax implications.

Deferred Consideration or Contingent Payments

Although it is not typical to carry out valuation adjustments through deferred consideration or contingent payments, in certain instances, parties do devise structures to address valuation uncertainties – for example, issuance and subscription of convertible instruments, or escrows (share-based or cash-based) to control deals and effect any future valuation adjustments. Note that under the foreign exchange laws of India, only 25% of the consideration can be paid by the acquirer as deferred consideration to be settled within 18 months from the date of the transfer agreement.

The Takeover Regulations prescribe several common conditions for takeover or tender offers, such as:

• minimum percentage of shares to be acquired (26% of the voting share capital);
• the minimum offer price and parameters, as discussed in 4.4 Consideration and Minimum Price; and
• the appointment of merchant bankers.

There may be certain exemptions in specified instances where the acquisition is between relatives or promoters, etc.

The Takeover Regulations do allow conditional MOOs. These are akin to standard open offers, except that ‒ if the desired level of shares is not tendered by existing shareholders (a limit that is specified in the tender offer documents) ‒ the investor is not obligated to acquire any shares at all under the open offer. A conditional open offer ensures that an acquirer meets its objective from the transaction. However, if the desired level of acceptance has not been met and the acquirer decides not to proceed with the transaction, the underlying acquisition that triggered the MOO is also not allowed to be completed. In the Indian context, conditional offers are an all-or-nothing commitment for the acquirer.

As discussed in 4.1 Stakebuilding, it is customary to enter into share subscription or share purchase agreements with the promoters/principal shareholders as a parallel process to the open offer. On the other hand, merger and demerger transactions are required to be documented through a scheme of merger/demerger and are required to be approved by the NCLT, along with an implementation agreement that sets out the obligations of the parties in the context of the transaction. Business transfer agreements are documented through a business transfer or asset transfer agreement.

Other than the obligation to constitute a committee of independent directors as discussed in 9.2 Special or Ad Hoc Committees, the target/listed company is typically required to obtain the necessary regulatory approvals as may be required for the deal. The Takeover Code also places certain obligations on the listed company – for example, the business of the listed company is to be undertaken as usual, consistent with past practice, during the offer period. The listed company is also restricted from carrying out the following acts without the consent of 75% of shareholders:

• alienating any material assets;
• undertaking any material borrowing other than in the ordinary course;
• issuing or allotting any unissued securities having voting rights;
• conducting any share buybacks or change the capital structure of the company; and
• entering into, amending or terminating any material contracts, etc.

Considering that public listed companies are required to make periodic disclosures under applicable laws, all price-sensitive information is available in the public domain; therefore, public listed companies typically do not provide representations and warranties in the context of the deal. Owing to corporate governance implications, listed companies also do not usually undertake additional obligations unless robust reasons can be evidenced towards benefits of the transaction in favour of the shareholders. However, in select instances, listed companies may provide fundamental warranties (such as authority and capacity, as well as due issuance of shares for subscription transactions). However, business warranties are based on commercial negotiations and usually provided if the acquisition is of a controlling interest and not a minority acquisition.

In the case of an MOO, the open offer is required to be for at least 26% of the voting share capital of the listed company. Unless conditional in nature (as discussed in 4.5 Common Conditions for a Takeover Offer/Tender Offer), the acquirer is required to acquire the tender received subsequent to the offer. In the case of a voluntary open offer, the acquirer is required to acquire at least such number of shares that would lead to the acquirer exercising 10% of the voting rights in the target company.

Under the Takeover Regulations, the acquirer is allowed to make a delisting-cum-tender offer.

Under the recently amended delisting laws applicable in India, an acquirer can carry out a delisting of the target company if:

• tender received in the offer is such that the total shareholding of such acquirer (together with the underlying acquisition) is not less than 75%; and
• 50% of the public shareholding has been tendered.

Note that the minority shareholders of the listed company are not under an obligation to tender in the offer.

Any forced exit or squeeze-out of the minority shareholders must be through a capital reduction process (to be approved by the NCLT) and requires an approval of 75% of shareholders. That said, in such cases, the minority shareholders have the right to approach courts and regulatory authorities to block the squeeze-out. The NCLT’s ambit of judicial review is limited to adjudicating on the fairness of the scheme.

The acquirer is required to have firm financial arrangements in place for fulfilling its payment obligations under an open offer, prior to launching the open offer. The financial arrangements are required to be verified by a SEBI-registered merchant banker hired to run the open offer process.

Tender offers are typically financed through internal accruals, equity financing or debt financing from non-banking entities (given that Indian banks are restricted from financing tender offers). Usually, debt-based financing is structured outside India through convertible instruments and the subscription amount is used to fund the open offer.

In this context, note that bankers and financial advisers are not required to trigger an open offer as part of the acquisition of the shares by the buyer. In certain instances, based on specific facts, SEBI has viewed providers of equity financing as PACs – ie, where financiers were considered to be using the acquirer as only a conduit to carry out the open offer on their behalf.

As discussed in 4.5 Common Conditions for a Takeover Offer/Tender Offer, the Takeover Regulations permit withdrawal of a mandatory tender offer only in certain limited cases. Inability to obtain financing is not one of them.

In the context of business combinations, arrangement of financing may be agreed as a condition to completion of the acquisition. From a corporate governance perspective, the board of the listed company may have to justify to the minority shareholders the rationale for including such a condition in the transaction documents vis-à-vis the requirements for listed companies to have deal certainty.

As discussed in 4.6 Deal Documentation, corporate governance implication is one of the key considerations guiding the ability of listed companies to support an acquisition transaction. Listed companies do not usually undertake additional obligations, unless proved to be favourable towards the shareholder body. Therefore, it is not typical for listed companies to grant any specific deal protection measures.

However, as also discussed in 4.6 Deal Documentation, the Takeover Regulations do prescribe certain value protection measures to be adhered to by the listed company during the period of the open offer. Obligations to continue to undertake business as usual and to not effect any change in capital structure of the company are among these measures.

At the outset, public listed companies in India are required to ensure that at least 25% of their equity shares are held by non-promoters (public). Acquirers cannot acquire 100% shareholding of a public listed company without carrying out a delisting of the target company.

Although Indian law permits majority shareholders to appoint nominee shareholders in the company, the directors have a fiduciary duty to act in the best interest of the company and not just in favour of the majority shareholders they represent. In fact, any arrangement where there is disproportionate allocation of governance rights in favour of majority shareholders vis-à-vis their shareholding – or that is detrimental to the minority shareholders ‒ is subject to regulatory scrutiny.

In the context of profit-sharing arrangements, compensation or profit-sharing arrangements with regard to dealing in securities between a majority shareholder and an employee/director of the listed company requires the board of directors’ approval and a separate minority shareholder approval.

As discussed in 4.1 Stakebuilding, Indian listed companies are largely promoter-driven, with a high concentration of promoter/principal shareholder shareholding. As such, acquirers usually enter into arrangements with the promoters/principal shareholders to acquire their shares, thereby triggering a MOO (subject to breach of relevant thresholds). However, the Takeover Regulations do not allow parties to such agreements to tender any of their shareholding in the MOO.

Indian regulators do not view such commitments favourably with regard to listed companies. This is because these structures tend to compromise shareholder democracy and influence voting decisions.

There is no requirement to obtain SEBI’s approval prior to launching the MOO or executing agreements that trigger the MOO. However, the draft offer is required to be submitted to SEBI for comments and, thereafter, SEBI’s comments are to be incorporated in the final offer letter before its circulation.

Under the Takeover Regulations, SEBI is required to provide its comments within 15 working days from the receipt of the letter. SEBI may also seek clarifications and additional information from the merchant banker and, often, the prescribed timeline may get extended until the clarifications and information are provided. In conducting its review, SEBI analyses the compliance of the tender offer with the Takeover Regulations (including the offer price) and ‒ broadly ‒ whether the terms of the offer and the transaction will have a detrimental impact on the minority shareholders.

The timelines for the tender offer are prescribed by SEBI through its various guidelines. However, the actual time involved in the process may vary, especially in transactions where regulatory approvals are required and the payments are subject to obtaining the approvals.

Competing offers can be launched only within 20 working days from the date of the initial tender offer. In such case, the schedule of activities and the tender period for both the initial tender offer and the competing tender offer are carried out with identical timelines, and the last date to tender in the initial tender offer is changed to the last date to tender in the competing offer.

If the completion of the tender offer is subject to regulatory/antitrust approvals, the payment to the tendering shareholders may be delayed until such approvals are obtained. Any such delay would, however, attract an interest to be specified by SEBI (typically 10%) to be paid to the tendering shareholders.

The timing for obtaining the regulatory approval is fact-specific and depends on the modalities of the deal. That said, usually parties approach the regulators for obtaining the approvals (or, at least apply for such approval) prior to launching the offer.

Please refer to 2.2 Liquidity Events for a detailed discussion on the acquisition structures typically adopted for privately held companies in India. In some cases, acquisitions may also be structured as a business transfer or asset purchase ‒ although share acquisitions are generally preferred, as they allow continuity of business and contractual arrangements.

Other than the key considerations discussed in 2.2 Liquidity Events, other key considerations include obtaining necessary regulatory approvals, compliance with FDI regulations, approval from sectoral regulators, and clearance from the CCI where applicable.

The buyers also undertake comprehensive due diligence to identify risks relating to regulatory compliance, including legal, tax and regulatory considerations, business contracts and any restrictions therein, financial projections, internal financial systems, and forensic analysis to identify financial impropriety. The buyers also undertake an assessment of promoter-related arrangements, which are common in private companies.

Where foreign investment is involved, the pricing of shares must comply with Reserve Bank of India (RBI) valuation norms. The use of deferred consideration or earn-outs is subject to regulatory requirements.

As discussed in 2.1 Establishing and Financing a New Company, setting up project companies or SPVs in the energy and infrastructure sectors requires compliance with the existing legal framework under the Companies Act. The regulatory landscape governing the specific sectors must also be taken into consideration.

Principally, no approvals need to be obtained, except in cases of licensed sectors. By way of example, generation of electricity is a de-licensed activity in India; a licence is required to be obtained for the transmission, distribution and trading of power. In the event of an investment by an entity of a country sharing a land border with India or where the beneficial owner of an investment into India is situated in or is a citizen of any such country, that entity can invest only under the government route – ie, after obtaining a prior approval from the relevant ministry and/or government department.

Regulatory Bodies

The key regulatory bodies governing the main sectors in the energy and infrastructure sectors are:

• electricity – the Ministry of Power and Ministry of New and Renewable Energy (with the adjudicatory bodies being the Central Electricity Regulatory Commission (CERC) and the State Electricity Regulatory Commission for interstate and intrastate electricity transactions);
• oil and gas – the Petroleum and Natural Gas Regulatory Board and the Ministry of Petroleum and Natural Gas;
• shipping and ports – the Ministry of Ports, Shipping and Waterways and the Directorate General of Shipping;
• roads and highways – the Ministry of Road Transport and Highways and the National Highways Authority of India; and
• telecommunications – the Department of Telecommunication and the Telecom Regulatory Authority of India;

Other relevant departments are the Bureau of Energy Efficiency and the Ministry of Environment, Forest and Climate Change, as well as municipal or local authorities.

Timeline for Obtaining Permits and Approvals

The timeline for obtaining the applicable permits and approvals is based on the project’s nature, size and location. However, it may take up to six months to obtain the approvals and/or licences in regulated sectors.

The primary securities market regulator for M&A transactions is SEBI for public listed companies.

India regulates foreign investment depending on the sector in which the investment is proposed to be made. In the energy and infrastructure sectors, except in the case of the mining and separation of titanium-bearing minerals and ores (as well as its value-addition facilities and integrated activities) and in the defence sector, 100% foreign investment is permitted under the automatic route – ie, prior approval does not need to be obtained. No FDI is, however, allowed in the atomic energy sector. (Please also refer to 5.1 Regulations Applicable to Energy and Infrastructure Companies.)

As for FDI filing, it is mandatory for foreign investors to adhere to certain reporting requirements. Depending on the nature of the investment (ie, whether primary or secondary), relevant forms must be submitted to the RBI, reporting the investment in equity instruments by foreign investors.

Please refer to 5.3 Restrictions on Foreign Investments. Although export control regulations do not apply to the energy and infrastructure sectors, such regulations are applicable to dual-use goods and technologies (ie, goods and technologies that can be used for both civilian and military purposes) and these cannot be exported without an export authorisation from the Director General of Foreign Trade. The restrictions are applicable to the export of:

• nuclear technology and materials;
• solar panels with specific components, depending on the materials involved; and
• technologies that could impact national security, especially in communications infrastructure.

According to the merger control regime in India, antitrust filing for takeover offers and business combinations is required if the business combination breaches the prescribed deal value threshold (DVT) and does not fall under any exemptions provided under the Competition Act 2002 (the “Competition Act”). A notification of the business combination must be made to the CCI if the combination breaches the DVT. The CCI has 30 working days from the date of notification in which to:

• issue a prima facie opinion if, on the basis of its analysis, the CCI believes that the transaction is likely to cause an appreciable adverse effect on competition (AAEC) in the specific industry; or
• approve the transaction if there is no AAEC.

However, if the CCI does not pass an order within a period of 210 days, the combination is deemed to be approved.

The Competition Act provides for the de minimis exemption, which exempts transactions from notification to the CCI if the target assets/company/business/division being acquired has either:

• assets valued at less than INR4.5 billion in India; or
• turnover not exceeding INR12.5 billion in India.

The Competition (Amendment) Act 2023 has introduced an additional test determining the DVT for notification to the CCI. A transaction must be notified to the CCI if:

• the value of the transaction exceeds INR20 billion; and
• the target has substantial business operations in India.

The key labour legislations and aspects that should be considered during an M&A transaction in India are:

• compliance with employee benefit legislation, including contributions towards funds and insurances; and
• disputes regarding employees, workers and contractors, trade unions, etc.

Although there is no formal works council system as is prevalent in European countries, companies typically have mechanisms for personnel representation through trade unions. Such consultations with employees and unions are not legally binding; however, if the target’s personnel are represented by a trade union, labour consultation may be required and forms the basis of the collective bargaining agreements entered into between the target company and such trade union. There is no mandatory requirement to disclose information about union representation or collective bargaining agreements either to the board or to the shareholders.

Currency control is primarily regulated by the RBI and governed by the Foreign Exchange Management Act 1999 (FEMA). A prior approval may be required from the RBI for a transaction involving FDI through the government approval route if the combination involves the transfer of shares or interest in an Indian company by a person resident outside India or by an overseas citizen of India or by an erstwhile overseas corporate body. As per the Companies (Compromises, Arrangements and Amalgamations) Rules 2016 (the “CAA Rules”), in cases of merger or amalgamation of a transferor foreign company incorporated outside India (being a holding company) and the transferee Indian company (being a wholly owned subsidiary company incorporated in India), a prior approval from the RBI must be obtained by both companies.

In order to regulate receipt and payment in foreign exchange transactions, the RBI has also issued the Foreign Exchange Management (Manner of Receipt and Payment) Regulations 2023, which provides that no Indian resident is permitted to make or receive payments from a non-resident, unless permitted under the foreign exchange laws or approved by the RBI. These regulations also bifurcate the transactions into trade transactions and transactions other than trade transactions. In the case of trade transactions, receipt and payment for any export or import have been provided for countries such as Nepal and Bhutan, as well as Asian Clearing Union member countries. Further, payments and receipts for any current account transaction (apart from trade transactions) may only be made in Indian rupees between an Indian resident and a foreign resident visiting India.

The following are some of the most significant legal developments in past three years with regard to energy and infrastructure M&A.

• In October, 2025, the RBI – through the Statement on Developmental and Regulatory Policies – has proposed to allow Indian banks to finance acquisitions by Indian companies. The guidelines to enable such financing will be issued shortly.
• On 19 June 2025, the RBI issued the RBI (Project Finance) Directions 2025 (the “Directions”) (effective from 1 October 2025), with the intention of providing a unified, principle-based prudential framework for project financing across different types of regulated lending entities.
• On 20 January 2025, the RBI issued amendments to the Master Direction on Foreign Investment in India (the “Master Direction”), which introduced critical clarifications on the regime governing downstream investment by Indian entities with foreign ownership or control and aligned the downstream investment framework with the provisions of the Foreign Exchange Management (Non-Debt Instruments) Rules 2019 (the “NDI Rules”). The amendments confirm that “foreign owned and controlled companies” (FOCCs) are permitted to make downstream investments under the automatic route, provided that the relevant sector permits 100% FDI under the automatic route and that pricing guidelines, reporting obligations, and other attendant conditions under the Master Direction and the NDI Rules are duly complied with.
• On 9 September 9 2024, the Ministry of Corporate Affairs notified certain amendments to Rule 25A of the CAA Rules, allowing a fast-track merger approval process in cases where a holding company incorporated abroad is proposing to merge into its India-incorporated wholly owned subsidiary. Prior to this amendment, the fast-track merger approval process was only available for domestic mergers. This amendment provides an impetus to “reverse flipping” by permitting inbound (cross-border) mergers to be undertaken through the fast-track merger process.
• The Competition (Amendment) Act 2023, together with the CCI (Combinations) Regulations 2024 significantly reformulated the Indian merger control regime, with effect from 10 September 2024. A mandatory notification requirement is now triggered where the value of a transaction exceeds INR20 billion and the target enterprise has “substantial business operations in India”, including user base, ownership of IP, or R&D presence. In parallel, the existing asset and turnover thresholds have been revised upwards, statutory review periods have been compressed to 30 calendar days for Phase I and to 150 days overall. The scope of “control” has been broadened to encompass negative rights (eg, veto powers) and access to competitively sensitive information, thereby potentially capturing minority acquisitions and private equity investments. Although the Green Channel route for deemed approvals has been retained, its availability has been curtailed in respect of transactions involving overlaps in digital markets or sensitive data sharing.
• The Union Budget 2025–26 amended Sections 72A and 72AA of the IT Act, with effect from 1 April 2025 – in the case of amalgamations, the carry-forward of accumulated losses will be permitted only for the balance period out of the original eight-year limitation from the year in which such losses were first incurred. Under the earlier regime, the limitation period effectively restarted upon completion of the merger, thereby curtailing opportunities for indefinite tax arbitrage through amalgamation-driven structures.
• The Union Budget 2024–25 abolished “angel tax” (ie, tax applicable on investments raised by start-ups if the total investment value exceeds the fair market value of the company) for all classes of investors.

As part of the Paris Agreement, in August 2022, India updated its “Nationally Determined Contributions”, with an emphasis on increasing the percentage of renewable energy consumption in its energy mix. India formulated the Panchamrit goals (a dedicated five-point strategy) to achieve its carbon reduction goals, which include the reduction of emissions intensity by 45% by 2030 and achieving 50% of non-fossil-fuel-based energy resources out of the total installed electric power capacity by 2030.

Legal Developments

In this context, the following are some of the most significant legal developments in past three years in relation to renewable energy.

• On 23 January 2023, the Ministry of New and Renewable Energy (MNRE) notified the “National Green Hydrogen Mission”, which set a target of producing at least 5 MMT of green hydrogen per annum by 2030, with the potential to increase up to 10 MMT.
• The MNRE subsequently issued the “Green Hydrogen Standard for India” on 18 August 2023 and the “Green Hydrogen Certification Scheme of India” on 29 April 2025, with the aim of establishing a standardised and credible framework for the certification of green hydrogen.
• On 20 December 2022, the Energy Conservation (Amendment) Act 2022 was notified, introducing a “renewable consumption obligation” ‒ under which, “designated consumers” are required to consume a specified percentage of electricity from non-fossil sources as part of their total energy consumption mix.
• On 28 June 2023, the government of India notified the “Carbon Credit Trading Scheme 2023”, to provide the framework for establishment of an Indian carbon market and a framework for reducing, sequestering or avoiding greenhouse gas emission across sectors.
• On 15 October 2022, the CERC issued the CERC (Connectivity and General Network Access to the Inter-State Transmission System) Regulations 2022 (the “GNA Regulations”) (ie, the “one-nation one-grid one-frequency” regime), which has been subsequently amended and also provides a connectivity framework for energy storage systems.
• On 9 October 2025, the Ministry of Power introduced the Draft Electricity (Amendment) Bill 2025, which proposes a significant overhaul of the existing Electricity Act.
• India has also sought to strengthen its domestic renewable energy manufacturing capabilities through the introduction of an approved list of module manufacturers for solar modules and solar cells, as well as a separate list for wind turbines.

Incentives and Schemes

The following government schemes and incentives promote investment in renewable energy:

• the Scheme for Development of Solar Parks and Ultra-Mega Solar Projects, aimed at developing 40,000 MW of solar capacity;
• the Central Public Sector Undertaking Scheme Phase-II, intended to support grid-connected solar projects using domestically manufactured cells and modules;
• a PLI scheme for solar modules, which aims to establish a gigawatt-scale domestic manufacturing ecosystem for high-efficiency solar modules;
• the PM-KUSUM Scheme, an initiative to promote solar-powered irrigation by supporting the installation of standalone solar pumps and small solar plants;
• the Rooftop Solar Programme Phase II, which offers direct subsidies for rooftop solar installation in the residential sector and performance-based incentives to distribution companies;
• the Green Energy Corridors initiative, established to create intrastate transmission networks for renewable energy ensuring efficient evacuation and grid integration;
• the National Bio Energy Programme, compromising three sub-schemes – namely, theWaste to Energy Programme, the Biomass Programme, and the Biogas Programme.
• waiver of interstate transmission charges for specified renewable energy projects commissioned by 30 June 2025; and
• the Sovereign Green Bonds Framework, launched to provide a framework for the raising of funds for public sector projects with environmental benefits.

Developments in Conventional Energy

Through the Union Budget 2025–26, the Indian government has announced the “Nuclear Energy Mission”, with the goal of achieving at least 100 GW of nuclear energy generation by 2047. In order to achieve this target, the Department of Atomic Energy and Niti Ayog have proposed certain amendments to the Atomic Energy Act 1962 (which governs the development of nuclear plants in India) and the Civil Liability for Nuclear Damage Act 2010. The amendments contemplate the introduction of private participation in nuclear energy with governmental oversight.

India has also set a capacity addition target of 80 MW of new coal-based thermal capacity by 2031–32 to meet rising power demands.

For mergers, demergers, and share acquisitions involving listed companies, the potential acquirers are provided with the opportunity to undertake a due diligence activity. The company may provide financial statements, material contracts, IP details, applicable permits and consents, details of litigation (both pending and threatened), etc.

However, any unpublished price-sensitive information (UPSI) can only be provided if the board is of the view that disclosing such information is in the best interest of the company and passes a resolution authorising the disclosure of UPSI. Nonetheless, in cases where a tender is floated, any UPSI of a company must be disclosed in tender documents and – in cases where no tender is triggered – such UPSI must be made public before the deal is finalised.

There are no regulatory restrictions on the quality or quantity of information that can be sought or provided in a due diligence process. However, the information provided to different bidders is based on the specific information sought by the bidders.

Under the Takeover Regulations, the public announcement of an open offer (based on the events discussed in 4.2 Mandatory Offer) must be made on the date of execution of the transaction documents (or, in indirect acquisitions, immediately afterwards) in the prescribed format. This is followed by a detailed public statement and, thereafter, the tender offer.

For the acquisition of unlisted companies, there is no requirement to publicly disclose a bid regarding the acquisition. In mergers, demergers and business transfers, the board is required to make statutory disclosures after approving the transaction.

In business combinations (scheme-based mergers or demergers) between unlisted companies or business transfer transactions, there is no requirement to issue a prospectus. If the business combination involves a listed company, an abridged prospectus must be issued.

Please note that there is no requirement for the buyer’s shares to be listed on a specified stock exchange for it to acquire the shares of a listed company.

In open offers, detailed financial statements of the acquirer do not need to be submitted, but limited audited financial information (eg, total revenue, net income, earnings per share) must be disclosed in the offer letter and the detailed public statement. In mergers and demergers, the financial statements of the entities must be provided to the exchanges for inspection by the shareholders.

The financial statements must be prepared in accordance with the applicable accounting standards. These include the accounting standards issued by the Institute of Chartered Accountants of India, as well as the Generally Accepted Accounting Principles.

In the acquisition of listed companies, the key terms of the transaction documents (eg, transaction type, any proposed change in control) must be specified in the tender offer and the detailed public statement, which are to be prepared in the standard formats prescribed by SEBI. The transaction documents do not need to be filed but must be made available for public inspection during the tender offer period.

If the proposed acquisition involves a sale of shares between residents and non-residents, the key extracts from the transaction documents are to be filed with RBI. Further, if the transaction triggers the requirement of a merger filing, then a copy of the transaction documents should be filed with the CCI as part of merger control filing.

The directors have a fiduciary duty towards the company and its shareholders (including minority shareholders) to act in good faith towards the best interest of the company, its members, the community at large, and the environment. Directors are required to exercise due care, skill and diligence, avoid conflicts of interest, and not seek undue gains. Independent directors have additional responsibilities, which include the obligation to report unethical and corrupt behaviour.

There are no special duties or obligations prescribed for directors in business combinations involving unlisted companies. However, for listed companies, directors have the following obligations during an open offer process: 

• the board of directors is expected to ensure that the business of the target company is conducted in the ordinary course;
• persons representing the acquirer are precluded from being appointed as directors of the listed company during the offer period;
• existing directors who may be representing the acquirer must not participate or vote on any matter in relation to the open offer; and
• after the closure of an open offer, the directors must assist the acquirer in the verification of the shares tendered for acceptance under the open offer.

The decision as to whether to establish special or ad hoc committees for business combination transactions depends upon the company and the complexity of the transaction. In merger and demerger transactions, parties can choose to constitute transaction implementation committees, which usually represent both of the involved parties equally and may include the directors of the companies involved. However, it is not typical for bilaterally negotiated business transfer transactions to have implementation committees.

The Takeover Regulations require the board of directors of the target company to constitute a committee of independent directors, which is required to provide reasoned recommendations on the open offer. This recommendation must be published at least two working days prior to the opening of the offer.

Directors are required to annually disclose their interest in any other entities and update such disclosures in a timely manner. Although directors have a fiduciary duty to ensure their interests are not in conflict with those of the company, directors of public companies are barred from participating in meetings or voting on resolutions that they may have an interest in.

The key duties of the board of directors include formulation of corporate strategy, allocation of resources, management of risks, communication with shareholders, and overall governance of the company. The board plays an active role in M&A transactions, as it is tasked with the strategic analysis of the target to ascertain synergy with the acquirer’s business and long-term strategic goals.

The board of directors plays an active role in business combinations, as it is required to approve these transactions. Other than setting up a committee as discussed in 9.2 Special or Ad Hoc Committees, in open offer transactions (where the promoters or principal shareholders are selling their shares), the target company’s board has a limited role ‒ given that the target company may not necessarily be a party to the transaction.

Although it is not common for shareholders to challenge the decisions of the board in case of M&A transactions, shareholder disputes do arise for reasons such as:

• the deal violates the existing rights of the minority shareholders under the articles of association or is oppressive to them;
• unfair dilution of shareholding;
• the terms of the open offer or valuation are detrimental to the minority shareholders; or
• the minority shareholders not being treated at par with the majority shareholders.

A buyer should be aware of the rights of minority shareholders under the articles of association and shareholders’ agreements and anticipate potential claims of oppression or mismanagement if such rights are disregarded. As part of the due diligence process, the buyer should review the minutes of board meetings to assess the board’s functioning and reasoning. The buyer may further allocate risks through indemnities, warranties and escrow arrangements, along with governing law and arbitration provisions in cross-border deals. In addition, obtaining board approval where required and involving independent directors and fairness advisers can enhance the integrity of the process.

Independent advice is typically sought on formulating transaction structures. This includes specific advice on tax implications, opinion from legal counsel on compliance with applicable laws and appropriate issuance of shares, and a valuation certificate from qualified independent valuers. The committee of independent directors, formed to provide recommendations on open offers, is permitted to seek professional advice or consult SEBI-registered merchant bankers. In mergers and demergers involving listed companies, a fairness opinion from a SEBI-registered merchant banker is mandatory before filing the scheme before the NCLT.

Specifically in the case of energy and infrastructure transactions, technical advisers are also appointed to ascertain the quality of the assets, the compliance of the assets with performance parameters vis-à-vis industry standards, as well as the overall operational life of the assets and the operational risks of the assets.