Tata Power Company, will acquire 10 per cent stake in Geodynamics, Australia-based geothermal energy company, for about Rs 165 crore (A$ 44.1 million). This investment is expected to strengthen presence in renewable energy segment and get foothold in the growing renewable energy Market in Australia.
Tata Power would 2.94 crore acquire stake, either directly or indirectly, in Geodynamics. The shares will be acquired at a price of A$1.50 per share. The rupee value for the transaction has been pegged at 37.5 to one Australian dollar.
Both the companies have agreed to review the potential of geothermal prospects outside Australia by leveraging the companies’ respective strengths. Further, this alliance also helps in securing a foothold in the growing renewable energy market in Australia, Prasad Menon, Managing Director, Tata Power said in a statement.
As part of the investment, Tata Power will also get a seat on the board of Geodynamics.
Geodynamics, a listed entity, is the industry leader in EGS with a market capitalization in excess of A$350 million (August, 2008). Geodynamics has geothermal exploration interests in 3 Australian states including the license for exploring 2000 sq. km of area in the Cooper Basin. Geodynamics tenements in the Cooper Basin contain the hottest granites on earth and are estimated to provide a thermal resource equivalent of 50 billion barrels of oil.
