ITEM 1. SECURITY AND ISSUER
This Schedule 13D relates to the equity shares at $0.000625 par value per share (the “Equity Shares”), of Azure Power Global Limited, a public company limited by shares incorporated in Mauritius on January 30, 2015 (the “Issuer”), with its principal executive offices located at 8 Local Shopping Complex, Pushp Vihar, Madangir, New Delhi 110062, India. The Equity Shares are listed on the New York Stock Exchange under the ticker symbol “AZRE.” Information given in response to each item shall be deemed incorporated by reference in all other items, as applicable.
ITEM 2. IDENTITY AND BACKGROUND
This Schedule 13D is being filed by International Finance Corporation, an international organization established by Articles of Agreement among its member countries (“IFC” or the “Reporting Person”) with respect to 7,874,149 Equity Shares. Such 7,874,149 Equity Shares include 2,684,696 Equity Shares directly owned by IFC and 5,189,453 Equity Shares directly owned by IFC GIF Investment Company I, a private company incorporated under the laws of Mauritius (“GIF Fund”). IFC controls IFC Asset Management Company, LLC (the “Manager”), which has management power and dispositive control over GIF Fund. IFC’s principal address is 2121 Pennsylvania Avenue, NW, Washington, District of Columbia 20433, United States. A member of the World Bank Group, IFC is the largest global development institution focused exclusively on the private sector in developing countries.
To the best of the Reporting Person’s knowledge, none of the Reporting Person, the Manager or GIF Fund has, during the last five (5) years, been: (i) convicted in a criminal proceeding; or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
In 2010, AZI (as defined in Item 6) issued 73,272 Series B compulsorily convertible preference shares (“CCPS”) and 1.1 million compulsorily convertible debentures (“CCDs”) for a total consideration of US$ 10 million. In 2012, AZI issued 4,439 Series D CCPS and 37,500 CCDs for a total consideration of US$ 2 million. In June 2014, AZI issued 36,000 compulsorily convertible debentures to IFC, at a price of Rs. 5,000 per share. In February 2015, AZI issued 20,307 additional Series F compulsorily convertible preferred shares at a price of Rs. 11,224.75 per share to IFC. In June 2015, AZI issued 22,214 shares of Series H compulsorily convertible preferred shares for US$ 10 million to IFC. Such securities automatically converted to Equity Shares upon the closing of the Issuer’s initial public offering without payment of consideration. 388,889 of such Equity Shares were sold by IFC in the Issuer’s initial public offering.
In June 2015, the Issuer issued 111,071 shares of Series H compulsorily convertible preferred shares for US$ 50 million to GIF Fund. In September 2016, the Issuer issued 55,535 shares of Series I compulsorily convertible preferred shares for US$25 million to GIF Fund. Such securities automatically converted to Equity Shares upon the closing of the Issuer’s initial public offering without payment of consideration.
ITEM 4. PURPOSE OF TRANSACTION
The ownership of the securities set forth in this Schedule 13D is for investment purposes only. At present, other than as described in this Schedule 13D, to IFC’s knowledge, none of the persons identified in Item 2 of this Schedule 13D have any plans or proposals which relate to, or would result in, any of the items for which disclosure is required pursuant to Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) IFC controls the Manager, which possesses management power and dispositive control over GIF Fund. As of the date of filing of this Schedule 13D, (the “Filing Date”) GIF Fund holds 5,189,453 Equity Shares, while IFC holds 2,684,696 Equity Shares of the Issuer. Based on information disclosed in the Issuer’s Final Prospectus filed with the Securities and Exchange Commission (“SEC”) on October 13, 2016 pursuant to Rule 424(b)(4) of the Securities Act of 1933, as amended (the “Securities Act”), there were 25,915,959 Equity Shares deemed issued and outstanding. As a result of the foregoing, for purposes of Reg. Section 240.13d-3, the Reporting Person is deemed to beneficially own 7,874,149 Equity Shares, or 30.4% of the Equity Shares deemed issued and outstanding as of the Filing Date. The number of Equity Shares outstanding does not give effect to the underwriters’ option to purchase up to an additional 511,364 Equity Shares within 30 days from the date of the Final Prospectus. This report shall not be deemed an admission that IFC or any other person is the beneficial owner of the securities reported herein for purposes of Section 13 of the Securities Act, or for any other purpose.
(b) The aggregate number and percentage of Equity Shares beneficially owned by IFC and the number of Equity Shares as to which there is sole power to vote or to direct the vote, shared power to vote or to direct the vote, sole power to dispose or to direct the disposition, or shared power to dispose or to direct the disposition are set forth on rows 7 through 11 and row 13 of the cover pages of this Schedule 13D and are incorporated herein by reference.
(c) In September 2016, the Issuer issued 55,535 shares of Series I compulsorily convertible preferred shares for US$25 million to GIF Fund, which automatically converted to Equity Shares upon the closing of the Issuer’s initial public offering without payment of consideration.
(d) No other person is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of Equity Shares.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER
On July 22, 2015, the Issuer entered into a shareholders agreement, among IFC, GIF Fund and certain other shareholders which terminates upon the completion of the Issuer’s initial public offering except for the following provisions: (A) a provision requiring, as long as GIF Fund and IFC collectively own an aggregate of 5% of the Issuer’s equity share capital, shareholder approval by special resolution for (i) amendments to Azure Power India Private Limited’s (“AZI”, a majority owned subsidiary of the Issuer) and its subsidiaries’ articles of association or memorandum of association, except as such amendments may be required for certain financing matters, (ii) material sales or disposals of the Issuer’s assets or the Issuer’s incurrence of material liabilities, (iii) changes to the Issuer’s business or the business of its subsidiaries and (iv) amendments to the Issuer’s share option plan; (B) a provision requiring, as long as GIF Fund and/or IFC hold any of the Issuer’s Equity Shares, shareholder approval by ordinary resolution to be obtained for equity issuances of more than 10% of the Issuer’s share capital; and (C) provisions requiring the Issuer’s continued compliance with certain standard policies of IFC and Société de Promotion et de Participation pour la Coopération Economique, or PROPARCO, on, among other things, environmental, social and anti-corruption issues, as long as IFC or PROPARCO, respectively, hold any of the Issuer’s equity securities.
On July 14, 2016 the Issuer entered into a registration rights agreement with IFC, GIF Fund and other shareholders, pursuant to which the Issuer will grant certain registration rights to certain holders of the Issuer’s Equity Shares. Subject to the terms of the registration rights agreement and certain lock-up agreements signed by IFC, GIF Fund and other shareholders, at any time or from time to time, and subject to certain limitation, IFC or one or more of the shareholders may request that the Issuer effect a registration of the Equty Securities under the Securities Act.
On October 11, 2016, the Issuer, IFC, DEG—Deutsche Investitions—und Entwicklungsgesellschaft mbH and Société de Promotion et de Participation Pour la Coopération Économique and Barclays Capital Inc. entered into an Underwriting Agreement, pursuant to which IFC sold 388,889 Equity Shares.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Shareholders Agreement by and among the Issuer, IFC, GIF Fund and the other shareholders named therein (incorporated by reference from Exhibit 10.3 to Amendment No. 1 to Form F-1 filed on March 1, 2016).
Form of Registration Rights Agreement by and among the Issuer, IFC, GIF Fund and the other shareholders named therein (incorporated by reference from Exhibit 10.8 to Amendment No. 5 to Form F-1 filed on June 30, 2016).
Form of Underwriting Agreement by and among the Issuer, IFC and other parties named therein (incorporated by reference from Exhibit 1.1 to Amendment No. 5 to Form F-1 filed on June 30, 2016).