Singapore sovereign wealth fund GIC has tied up with Vedanta Group company Sterlite Power to form a new platform to develop and operate power transmission projects in India.
Sterlite will have a 51% stake in the new platform while GIC will hold the remaining 49%, the Indian company said in a statement. It didn’t disclose any other financial terms of the JV.
“With GIC as our partner, we are poised to play a leading role in India’s transmission sector, starting with the $13 billion bid pipeline,” said Pratik Agarwal, managing director at Sterlite Power.
Sterlite previously sponsored India Grid Trust, India’s first power sector infrastructure investment trust (InvIT). IndiGrid is now controlled by private equity firm KKR. GIC first invested in IndiGrid in 2019 and owned 17.9% units of the InvIT as of Dec. 31, 2023.
The JV is reportedly part of an internal restructuring exercise at the billionaire Anil Agarwal-promoted Vedanta Group, which is looking to unlock value from its power transmission and other assets.
Sterlite is reportedly looking to demerge its solutions business and then list it later, on domestic exchanges.
The JV has been formed even as the industry is hoping that the government will soon invite bids for power transmission infrastructure projects worth more than Rs 1.5 trillion.
In August last year, GIC had said that it was looking to invest in the Indian infrastructure sector. GIC manages assets north of $700 billion globally. It has been looking to move some of its money from China to India, as Asia’s biggest economy has not fully emerged from the severe disruptions caused by the Covid pandemic.
In July, GIC joined hands with smart metering company Genus Power to invest $2 billion in projects in India.
GIC has also been looking to ink other big-ticket infrastructure investment deals in India, across the board. It has formed a logistics and warehousing platform with real estate asset manager ESR and has exposure to the highways sector through its investment in IRB Infrastructure Developers and the Indian company’s infrastructure investment trust (InvIT).
Sterlite Power is a private sector power transmission infrastructure developer and solutions provider with a portfolio of 33 completed, sold and under construction projects covering approximately 15,350 circuit Kms of transmission lines across India and Brazil.
In India, Sterlite Power has over $2 billion worth of projects under management. It has won a third (by tariff) of all inter-state private transmission projects awarded in India under competitive bidding since 2011.
Apart from this, Sterlite has a portfolio of high-performance power conductors, extra-high voltage cables and optical ground wires. The company says it provides bespoke solutions for the upgrade, uprate, and fiberization of existing transmission infrastructure projects.
