The Lanco Udupi power plant has already signed with Karnataka Government for further expansion of 1320 MW.
Debt laden Lanco Infratech Limited (LITL), is an integrated infrastructure player in the country having business verticals in EPC, power, solar, natural resources and infrastructure
The imported coal based thermal power plant of Lanco in Udupi, which supplies 90% of the power generated to Karnataka and 10% to Punjab, is the first independent power project in the country based on 100% import coal with a captive jetty of 4 million tons per annum and an external coal handling system in the new Mangalore Port Trust. The capacity can be, if required, expanded to handle another 4 million ton capacity.
"For Lanco Infratech, this transaction will support the company in reducing its debt and will enable Lanco to receive about 2000 crore as cash and additionally, Adani Power will take Udupi Power's long-time debt of around Rs. 4,000 crore," said Lanco in a statement.
The deal is likely to further consolidate Adani Group's position as India's largest private sector power producer with a capacity of about 10,000 MW. The group, with a capacity of 8,620 MW, plans to more than double its generation to over 20,000 MW in the next five years.
The move comes on the heels of India's biggest power-infrastructure deal outside telecom, with Reliance Power pipping the Adani Group and JSW to acquire Jaypee Group's hydel power projects last month for around Rs 12,000 crore.
Adani Power is also learnt to be in talks with debt laden companies for buying out their power plants that includes Indiabulls for buying out its Amravati power plant and with Jaypee Group to buy out its Bina power plant.
The consolidation in the ailing power sector is seen as a sign of revival with serious players looking to buy distressed assets of 50,000 MW in the secondary market.
Shares of Lanco Infratech closed down 5% at Rs 8.5 while shares of Adani Power closed down 3.7% to Rs 52 in a stable Mumbai market on Wednesday.
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