Adani Power has signed a definitive share purchase agreement with GMR Infrastructure Ltd. (GIL) to buy its 47.62% stake in GMR Chhattisgarh Energy Ltd. (GCEL), held by its wholly owned subsidiary, GMR Generation Assets Limited (GGAL).
The company will buy the remaining stake from lenders as the consortium of lenders of GCEL adopted “change in management” as a resolution plan (RP) in accordance with the guidelines issued by Reserve Bank of India. The deal was executed at an enterprise value of ₹4,792 crore. The lenders followed a detailed bidding process and selected Adani Power as the final bidder. GCEL has received 100% approvals of all lenders for implementation of the resolution plan, which will lead to a significant deleveraging for the GMR Group.
GECL is a supercritical, domestic, coal-based power plant having installed capacity of 1,370 MW (2 x 685 MW) located at Raikheda, Raipur District Chhattisgarh. The company’s total revenue for financial year 2018-19 was ₹814.7 crore.
“GCEL had an outstanding debt of ₹5,926 crore as on March 31, 2019. In addition, GIL’s profitability is expected to improve significantly considering GIL consolidated profit for FY2019 was adversely impacted by ₹516 crore on account of Chhattisgarh Power Plant,” said GMR in a statement, adding that the corporate guarantees to the extent of ₹892 crore, furnished by GMR Group companies — GMR Energy Ltd., GGAL and GMR Power Corporation Ltd. — shall be released.
Adani Power had earlier agreed to acquire Korba West Power Company Limited (KWPCL) a sub-critical, domestic, coal-based power plant having installed capacity of 600 MW in District Raigarh district of Chhattisgarh. The company had offered to pay upfront payment of ₹100 crore to secured financial creditors, ₹104 crore to the operational creditors and restructure debt of ₹1,000 crore.
Both, the acquisition will enhance Adani Power’s position as India's leading private sector thermal power producer, with a combined thermal power capacity of 12,410 MW.
