Gautam Adani led Adani Transmission (ATL), has signed definitive agreement with GMR Energy to acquire 74 per cent shares of Maru Transmission Service Company Limited (MTSL) and 49 per cent shares of Aravali Transmission Service Company Limited (ATSL) with an option to increase its stake in both firms to 100 per cent for equity value of Rs. 100 crore.
“Adani Transmission Ltd. is foreseeing significant growth in the Transmission sector and expects to maintain its leadership position in the country. This acquisition is in sync with the long term strategy of ATL wherein, we are always looking to create value for our stakeholders,” said Adani Group chairman Gautam Adani.
MTSL operates 270 km of transmission lines while ATSL operates 96 Km of transmission line in Rajasthan. All the three distribution companies of Rajasthan (Discoms) are the beneficiaries of the transmission services being provided by these transmission SPVs, said a company statement adding that both the assets are operating at an average availability of more than 99.90 per cent.
Both assets were awarded through a tariff based competitive bidding process with license period of 25 years, further extendable by 10 years. ATL is developing another transmission line from Suratgarh to Bikaner in Rajasthan, in close proximity to these assets.
For, GMR Energy, the total value realizable could be Rs. 220 crore considering the equity consideration and the expected upside of up to Rs. 120 crore from regulatory proceeds of various appeals of the assets before the APTEL, said a GMR statement adding that the total debt in the projects as on March 31, 2016 is Rs. 324 crore.
Post consummation of the above transaction, the consolidated debt of GMR Group would be reduced. Speaking on the stake sale, Mr. GBS Raju, Business Chairman – Energy, GMR Group said “GMR Group continues on its path of Asset Light Asset right strategy. The deal will release further liquidity and deleverage the GMR balance sheet. The asset sale done at challenging market environment further signifies GMR’s ability to create value for its stake holders.”
Adani Transmission shares closed up 1.3 per cent at Rs. 39.05, while GMR Infra shares were trading down 1.72 per cent at Rs. 13.14 in a firm Mumbai market on Friday.
