Kalpataru Power Transmission said on Wednesday it has entered into binding agreements with CLP India to sell its stake in three power transmission assets for an estimated enterprise value of Rs 3,275 crore.
CLP India is owned by CLP Group, one of the largest investor-owned power businesses in Asia, and Caisse de depot et placement du Quebec (CDPQ), one of Canada's leading institutional fund managers. Since 2002, CLP India has gradually grown its footprint to become one of the largest foreign investors in the Indian power sector.
The assets being offloaded are Kalpataru Satpura Transco, Alipurduar Transmission and Kohima Mariani Transmission. The transaction is subject to requisite approvals and compliances, it said in a statement.
As a part of this deal, the transaction for Alipurduar Transmission and Kohima Mariani Transmission will be effective post commercial operation date and fulfilment of certain conditions. Techno Electric and Engineering Company own 26 per cent stake in Kohima Mariani Transmission.
The estimated amount of debt at special purpose vehicles level will be about Rs 2,000 crores at the time of commercial operation date. Ernst & Young and Khaitan & Company are advisors to Kohima Mariani Transmission and Techno Electric and Engineering Company for the transaction."The sale of assets will lead to a significant reduction in Kalpataru Power Transmission's consolidated debt and help focus on strategic diversification within the core business," said Managing Director and CEO Manish Mohnot.
"The sale is a milestone and a testament to our ability to create, operate, and hive off assets at the right moment. The company will continue to focus on sustainable and profitable growth with a commitment to improve return ratios."
KPTL is one of the largest engineering, procurement and construction companies in India engaged in power transmission and distribution, oil and gas pipeline, railways, infrastructure development, civil contracting and warehousing and logistics business with a strong international presence in power transmission and distribution.
"The Indian market is a primary growth market for CLP and CDPQ, and the two companies share a vision to invest only in low carbon, clean energy portfolio in India," said CLP India's Managing Director Rajiv Mishra.
"Entering the transmission sector is a landmark for CLP India. The acquisition of Kalpataru Power Transmission's assets will enable us to expand our geographical reach across the country and reinforces our commitment to grow our investments. "
CLP India's 16 wind energy projects and three solar energy projects span across seven states. Its diversified generation portfolio includes renewable and conventional energy amounting to over 3,000 MW. The company also owns a coal-fired power plant in Haryana and a gas-based combined cycle power plant in Gujarat.
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