Adani Power Gets Board Nod To Acquire Korba West Power, GMR Chhattisgarh
Adani Power Ltd.'s board has approved the proposal for the acquisition of insolvent firms Korba West Power Company Ltd. and GMR Chhattisgarh Energy Ltd., in a move that would pave the way for the Gautam Adani-led group flagship to expand capacity.
The above proposal for acquisition of entire equity stake of GMR Chhattisgarh Energy and Korba West Power Company shall be on the terms of the respective approved resolution plans of both these companies, Adani Power said in an exchange filing. The resolution plans for both firms have been approved by the authorities concerned between June 25 and June 28, respectively, it said.
The successful acquisition of GMR Chhattisgarh and Korba West Power will consolidate Adani Power's position as India's leading private sector thermal power producer and increase the combined thermal power capacity by 19 percent to 12,410 megawatts, Adani Power had said in a statement earlier.
Korba West Power
Adani Power will acquire a 100 percent stake in this Chhattisgarh-based power plant by paying Rs 204 crore to secured financial and operational creditors, the filing said. The debt will be restructured to the tune of Rs 1,000 crore with the deal being estimated to be completed by July end, it said.
The Korba West Power plant, however, has not generated power since May 2017.
GMR Chhattisgarh Energy
Adani Power will also acquire full interest in GMR Group's energy arm for an enterprise value of Rs 4,792 crore with the deal being expected to be completed by July 5, the filing said. Adani Power shall hold 100 percent equity stake, of which 52.38 percent is to be acquired from lenders and 47.62 percent from GMR Group, it said.
Adani Power shares have gained 1.58 percent since June 25, compared with a 2.09 percent rise in the BSE Power Index, Bloomberg data showed. Still, 86 percent of the analysts covering the stock suggest a ‘Sell', with a negative long-term return potential of 36.1 percent.
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