JSW Energy signs pact to acquire GMR Kamalanga

GMR Infrastructure on Monday informed the bourses that its subsidiary-GMR Energy Limited has signed definitive agreements for the sale of its entire stake in GMR Kamalanga Energy Limited.

GMR Energy shall also procure balance stake in GMR Kamalanga from IIF and IDFC First Bank, to enable JSW Energy Limited (JSWEL) in acquiring 100 per cent stake in GMR Kamalanga, for a total consideration of up to Rs 5,321 crore (subject to working capital and other adjustments).

This acquisition, which is in-line with JSW Energy’s strategy for expansion and consolidation in the power sector, is actively evaluating various strategic assets for the acquisition.

GMR Kamalanga is a 1,050 MW (3* 350 MW) coal-based power plant in Dhenkanal district of Odisha, with the option of adding another unit of 350 MW. The revenue generated from acquiring asset as on March 31, 2019 was Rs 2,195 crore.

The transaction will be for cash consideration and with this, the entire debt of GMR Kamalanga of Rs 4,141 crore will be reduced. The expected time for the completion of this transaction is around 90 days from the execution date of Share Purchase Agreement (SPA), subject to fulfillment of the conditions precedent set out in SPA.

With this, the stock of JSW Energy surged on the bourses by almost eight per cent to touch an intraday high of Rs 68.4 while, the stock of GMR Infra was trading in negative terrain.