Adani Transmission Ltd said on Monday it will buy a subsidiary of Kalpataru Power Transmission Ltd.
The enterprise value for the subsidiary called Alipurduar Transmission Ltd is Rs 1,286 crore (about $170 million).
The acquisition is expected in two months, subject to regulatory approvals and other consents.
Last year in May, Kalpataru was reported to be in discussions to sell four of its energy-transmission lines to Adani Transmission.
Later in July, Mumbai-headquartered Kalpataru had said that CDPQ-backed CLP India Pvt. Ltd had agreed to buy a stake in Kalpataru Satpura Transco, Alipurduar Transmission and Kohima Mariani Transmission.
“We now have agreements in place for Alipurduar, Kohima and Jhajjar transmission assets. In 2019-20, we had already completed the sale and transfer of the Kalpataru Satpura transmission asset. We are now targeting to complete the sale and transfer of the rest of the transmission and distribution assets in 2020-21,” said Manish Mohnot, managing director and chief executive of Kalpataru.
In March last year, Kalpataru had also signed a pact to acquire an 85% stake in Swedish engineering and construction company Linjemontage i Grastorp AB.
Alipurduar
The target firm Alipurduar is a project-specific special purpose vehicle (SPV) incorporated on 13 April, 2015 as a wholly owned subsidiary of REC Transmission Projects Company Ltd.
In January 2016, the SPV was transferred to Kalpataru.
Alipurduar was set up as a part of a transmission system for strengthening and transferring of power from new hydroelectric power projects in Bhutan to India.
It operates transmission lines aggregating to around 650 circuit kilometres in West Bengal and Bihar.
The project was awarded through a bidding process on a build, own, operate, maintain basis.
In 2019-20, Alipurduar generated revenue of Rs 90.36 crore, 0.7% of Kalpataru’s consolidated revenue.
Its net worth stood at Rs 170.20 crore, which is 5.07% of Kalpataru’s total consolidated net worth.
Kalpataru is engaged in power transmission & distribution, oil & gas pipelines, railways, infrastructure development, civil contracting and warehousing & logistics business.
It has a strong international presence in power transmission & distribution. The company is currently executing several contracts in India, Africa, West Asia, Commonwealth of Independent States (CIS), SAARC and Far East.
Adani Transmission
Adani Transmission, subsidiary of Adani Enterprises, is the country’s largest private transmission and retail electricity distribution company with a cumulative transmission network of more than 15,400 circuit km, out of which more than 12,200 circuit km is operational. This includes around 3,200 circuit km in various stages of construction.
“The acquisition of Alipurduar will bolster the pan-India presence of Adani Transmission consolidating its position as the largest private sector transmission company in India,” said Adani Transmission’s managing director and chief executive Anil Sardana.
“This asset will take Adani Transmission closer to its target of setting up 20,000 circuit km of transmission lines by 2022,” he added.
Adani Transmission had bought the Mumbai power business from Anil Ambani-led Reliance Infrastructure Ltd two years ago. That transaction valued the business at Rs 12,101 crore.
The total number of subsidiaries of Adani Transmission as on March 31, 2020 was 28 including Adani Electricity Mumbai Services Limited, which operates a distribution business serving over 3 million customers in Mumbai.
In December 2019, VCCircle reported that Qatar Holdings LLC will acquire 25.1% stake of Adani Electricity Mumbai Services.