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The country's largest power producer in the private sector, Adani Power Limited (APL), will acquire the 1,200 megawatt (MW) Essar Power's Mahan Project located at Singrauli district of Madhya Pradesh. Resolution Professional of the National Company Law Tribunal (NCLT) issued a Letter of Intent to Adani Power on June 17, said Adani Group company in a filing on stock markets.
Essar Power's Mahan power plant supplies power through the Mahan-Sipat transmission line and is also connected with a railway siding 18 km away from the plant for the supply of coal and other raw materials. According to industry sources, Adani Power will shell out close to Rs 3,000 crore for the Mahan Project.
"This is to inform that the Committee of Creditors of Essar Power M P Ltd, a company undergoing insolvency resolution under the Insolvency and Bankruptcy Code, has approved the Resolution Plan submitted by Adani Power Limited," read the submission by Adani Power.
It added that the closure of the transaction shall be subject to obtaining necessary approval from the NCLT and satisfaction of conditions precedent under the Resolution Plan.
The development comes at a time when power demand is looking up with the revival of economic activities as the COVID-19 cases have started coming down in the past few weeks.
Adani Group has been on an acquisition spree for power generation assets across the country. Last month, Adani Group's renewable energy arm Adani Green Energy acquired SB Energy's solar and wind power portfolio from Softbank and Bharti Group.
SB Energy's portfolio consisted of solar projects of 4,180 MW, the wind-solar hybrid capacity of 450 MW and 324 MW of wind power projects. AGEL has emerged as one of the largest renewable energy companies with an asset portfolio of over 24,000 MW at various stages of development.
Adani Power's thermal project portfolio consists of 12,500 MW of generation capacity spread across Gujarat, Karnataka, Chhattisgarh, Maharashtra and Rajasthan. It is also commissioning 1,600 MW of project in Jharkhand. The company will consolidate its leadership position in the power sector further with the addition of 1,200 MW of generation asset.
Essar Power's Mahan project that operates two units of 600 MW can be expanded by one more unit to make it a 1,800 MW project. Essar Power commissioned 600 MW unit each in late 2012 and in mid-2017 respectively.
"In the coming years, we will continue to tap promising business opportunities, while striving to improve our operating efficiencies on all parameters and leveraging our deep experience as well as complementarity with the Adani Group's energy portfolio, to bring about sustainable and profitable growth," Adani Power MD Anil Sardana had said while announcing company's performance for the financial year 2020-21.
The company's performance for FY 2020-21 was affected by the sharp drop in demand due to strict nationwide lockdown imposed to combat COVID-19 last year. However, its consolidated total income for fiscal 2020-21 stood marginally higher at Rs 28,150 crore compared to the revenue of Rs 27,842 crore in 2019-20. Its total comprehensive income after tax was Rs 18 crore for the last quarter of 2020-21, as compared to the loss of Rs 1,299 crore for the corresponding quarter of 2019-20.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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First Published: Sun, June 20 2021. 19:54 IST