The Adani group and Reliance group today completed the Rs 18,800-crore deal under which Anil Ambani-led Reliance Infrastructure has sold its energy business in the city, including generation, distribution and transmission to Adani Transmission.
While the deal, the largest in the power sector, marks the entry of the Gautam Adani group, which thus far has only been into power generation and transmission, into the distribution space, for RInfra the sale is a big boost to pare its debt which stood at over Rs 22,000 crore.
The deal was announced by the companies in December last year.
RInfra's integrated power business includes the generation units based at Dahanu, transmission network across Mumbai and Maharashtra and the retail distribution network in Mumbai suburbs.
With this deal, Adani Transmission will have 35 grid substations with around 19,300 MVA of transformation capacity across the country, by the end of 2018 with a cumulative transmission network of around 12,540 circuit km, of which around 9,201 circuit km is operational.
The deal includes absorption of about 5,000 employees across three business areas of RInfra, said Anil Sardana, managing director and chief executive of Adani Transmission, and chairman of Adani Electricity Mumbai.
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Adani Transmission, which is the largest private sector transmission and power distribution entity, said post-deal the company will be known as Adani Electricity Mumbai, which which will be a subsidiary of Adani Transmission. It will serve over three million customers spread across 400 sq km in Mumbai.
On the acquisition and expansion of the business, Adani group chairman Gautam Adani said, "This marks our significant launch into large-scale city electricity distribution business and we are privileged to serve over three million consumers in Mumbai.
"We aspire to enter into electricity distribution business in other key cities and districts. We are committed to leverage our experience to emerge as a leading utility in electricity distribution, thereby providing state-of-the-art, reliable and competitive supply experience to all our customers," Adani said in a statement.
Addressing the media to announce the completion of the deal, Ambani said, "With this deal, RInfra has managed to reduce its debt by 65 per cent from Rs 22,000 crore to Rs 7,500 crore. We intent to become debt-free by next year."
Whether the company is planning more asset monetisation, Ambani said, "We don't need to pursue any other asset monetisation now. Asset monetisation is not planned but equity infusion through QIP and rights both are in place."