Adani Transmission To Buy Mumbai Power Business Of Reliance Infra For Rs 13,251 Crore
Gautam Adani’s Adani Transmission has made a firm agreement to buy Anil Ambani’s Reliance Infra Power Generation and the distribution business in Mumbai for Rs 13,251 Crore. Both companies gave this information on Thursday. Adani will sign the Transmission Power Distribution Business from this deal and will help Reliance Group to reduce its debt from the money it receives.
Reliance Infrastructure CEO Lalit Jalan said, “We have made a deal at the best possible price. The money we get from this will be used to repay the debt. He said, “We are expecting this deal to get the permission from the Maharashtra Electricity Regulatory Commission and our bankers. They will be able to complete the deal before March.”
The Adani Group will pay a lump sum amount of Rs 13,251 Crore to Anil Ambani’s Reliance Group for this. Anil Ambani’s company will get a total of Rs 18,800 Crore with regulatory assets. Adani Transmission has put the value of the business at Rs 12,101 Crore. Regulatory approved assets of Rs 1,150 Crore will be added to Reliance Infrastructure’s account during April 1, 2018 to March 31, 2019. With this deal, Reliance Infrastructure plans to repay the outstanding debt of Rs 15,000 Crore. This will reduce the pressure on the company’s balance sheet.
This will be the second deal between the two companies. Earlier, Adani Transmission bought two transmission projects from Reliance Infrastructure for Rs 1,000 Crore. This deal happened in November. While earlier to that in October, there was an exclusive deal between the two companies, in which it was a matter of buying power generation, transmission of Reliance infrastructure and distribution business in Mumbai.
Gautam Adani, head of Adani Group, said, “With this deal we are entering into the power distribution sector in the country. We look at it as the next rising sector. India is moving towards the goal of 24×7 power supply for all the countrymen. We believe that this segment has huge opportunities for growth. We will continue to enhance this business from direct or indirect methods.”
In this deal, a 500 MW power plant in Mumbai will also be transferred to Adani Group in Reliance Infrastructure. It will get the license of power distribution and related infrastructure in the city. Reliance Infrastructure has three million subscribers in Mumbai Distribution Circle. They require a total of 1,892 Megawatts of electricity, out of which 500 MW power is provided by its power plant.