JSW Energy on Monday said it has entered into share purchase agreement with GMR Energy to acquire its subsidiary, GMR Kamalanga Energy, for Rs 5,321 crore. GMR Kamalanga Energy (GKEL) owns and operates a 1050 MW (3 x 350 MW) coal based thermal power plant located at Dhenkanal, District Kamalanga, Odisha.
"The company has signed share purchase agreement with GEL, pursuant to which the company shall acquire 100 per cent stake in GKEL for a total consideration of an amount up to Rs 5,321 crore (subject to working capital and other adjustments)," JSW Energy said in a filing to the Bombay Stock Exchange.
The company has to complete the deal within 90 days from the execution date of share purchase agreement, it added.
The acquisition was part of the company's strategy for expansion and consolidation in the power sector. Consequent to the acquisition, GKEL will be a 100 per cent subsidiary of the company.
Post-acquisition, the total installed power generation capacity of JSW Group firm will increase to 5,609 MW. This will expand the company's presence in the eastern region of the country and further diversify its fuel mix and off-take arrangements, JSW Energy said in the regulatory filing.
"The transaction will be subjected to customary regulatory and other approvals for its completion," it added.
The company seeks approvals from the Competition Commission of India (CCI), GKEL lenders, Industrial Development Corporation of Odisha (IDCO), Uttar Haryana Bijli Vitran Nigam Limited and Dakshin Haryana Bijli Vitran Nigam Limited.
Earlier on 7 October, 2019, JSW Energy had announced that it entered into exclusive discussions with GMR Energy for potential acquisition of its subsidiary, GMR Kamalanga Energy.
GKEL, which is engaged in the business of power generation, reported revenue at Rs 2,195 crore as on 31 March, 2019. In FY18 and FY17, the company's revenue stood at Rs 1,990 crore and Rs 1,916 crore, respectively.
Ahead of the announcement, shares of JSW Energy closed Monday's trade at Rs 63.55 apiece, up 1.11 per cent on the BSE.
By Chitranjan Kumar