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Mumbai, Oct. 28 Suzlon Energy Ltd has suspended its plans for a rights issue to raise Rs 1,800 crore, citing the current market conditions.

The funds were to be used for buying 22.48 per cent stake of Martifer, a Portuguese construction major, in REpower Systems, the German wind power company.

In May 2007, Suzlon had acquired REpower for euro 1.35-billion (about Rs 7,314 crore). Martifer was a major shareholder in REpower, and had partnered with Suzlon in the bid to acquire a stake in the company. At the time of the acquisition Suzlon entered into a deal with Martifer and Areva to buy out their stake in REpower.

On September 1, the company had announced its proposal of acquiring Martifer’s share in REpower. This would have increased Suzlon’s stake in REpower to 90 per cent.

In a statement to the stock exchanges on Monday, the company also announced that it was suspending its ongoing discussions with REpower for a ‘Domination Agreement’. “Both parties have jointly agreed to suspend the process of negotiation of domination agreement for the time being. However, we will pursue our strategy for sustainable growth,” Suzlon said.

Under the German Stockholder Corporation Law, the stakeholder holding majority shares has to sign a Domination Agreement in order to control the company. Otherwise the ownership and management are two separate entities. The management is not bound by the majority stockholder’s advice.

Suzlon also informed that IDFC Private Equity had invested Rs 400 crore for a 17.1 per cent stake in SE Forge Ltd, a subsidiary of Suzlon.

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