A consortium led by Abu Dhabi National Energy Company (TAQA) will buy 2 hydroelectric power plants of Jaiprakash Power Ventures for about Rs 3,820 crore (USD 616 million), TAQA said today.
The acquisition will make it the largest private operator of hydroelectric plants in India, the company said in a statement.
"The consortium agreed to purchase the Baspa Stage II and Karcham Wangtoo plants in the northern state of Himachal Pradesh, from Jaiprakash Power Ventures Ltd, a subsidiary of Indian infrastructure conglomerate Jaypee Group," it said.
TAQA, which holds 51 per cent stake in the consortium, will have control of operations and management of both the facilities under the proposed deal, it said.
The remaining equity will be held by one of Canada's largest institutional investors (39 per cent) and IDFC Alternatives' India Infrastructure Fund II (10 per cent).
TAQA said: "The equity invested by the consortium in the acquisition of the two hydroelectric plants will amount to approximately Rs 3,820 crore (USD 616 million, based on Mar 1 2014 foreign exchange rate), of which 51 per cent is from TAQA."
The consortium will also acquire the assets' non-recourse project debt.
TAQA's Executive Officer and Head of Global Power & Water Frank Perez said: "India's economic growth depends on having ample and reliable energy supply. TAQA is pleased to add these two high quality hydro power assets to our growing India business and to support India's economic growth."
The two plants have a combined power generation capacity of 1,391 MW and are located in Kinnaur district within two km of each other. They share support facilities and use run-of-the-river technology to convert natural water flow to electricity, eliminating the need for a reservoir.
The plants are 35 km from the Sorang hydroelectric plant, in which TAQA acquired stake last year.
Following the completion of the transaction, TAQA's gross operational power generation capacity in India will rise to 1,741 MW, comprising of 3 hydel power and one lignite plants.
The acquisition is expected to close in 2014 and is subject to regulatory and third party approvals.
"This investment will be recognised at the second meeting of the UAE-India High Level Joint Task Force in Mumbai on March 3, 2014 co-chaired by Sheikh Hamed bin Zayed Al Nahyan, Chairman of the Abu Dhabi Crown Prince Court, and Anand Sharma, India's Minister of Commerce and Industry," it said.
