Tata Power JV to buy two power plants at Rs 920 cr from Tata Steel

Tata Power on Friday said its joint venture Industrial Energy Ltd has signed pacts with Tata Steel to acquire a captive gas-based power plant and a diesel project in Kalinganagar, Odisha for around Rs 920 crore.

Industrial Energy Ltd (IEL) is a joint venture between Tata Power and Tata Steel in the ratio of 74:26, respectively.

"IEL...has signed asset purchase agreements with Tata Steel on October 24, 2019 for acquisition of 120 MW captive gas-based power plant and 40 MW diesel generating station (40 MW DGS) at Kalinganagar from Tata Steel," Tata Power said in a BSE filing.

According to the statement, while the 120 MW plant is under construction and will be operational by 2021-22, the 40MW DGS is already operational. The combined value of the transactions is about Rs 920 crore, subject to minor adjustments on closing and applicable taxes and duties.

IEL has also signed tolling agreements with Tata Steel for supply of power for a period of 30 years from 120 MW plant and 15 years from the 40 MW DGS.

It said Tata Sons Private Ltd (TSPL) is the common promoter of Tata Power and TSL.