Adani Power, in a regulatory notification, said that it has planned to acquire DB Power Ltd, subject to fulfillment of statutory approvals, at an enterprise value exceeding Rs.7,000 crore.
DB Power Ltd owns and operates a 2×600-mw coal-fired power plant in Janjgir-Champa district of Chhattisgarh. DB Power has long and medium-term power purchase agreements for 923.5 mw of the total 1,200 mw capacity of the said power plant. It also has fuel supply agreements with Coal India Ltd, and has been operating its facilities profitably, Adani Power said.
The acquisition will help Adani Power to expand its offerings and operations in the thermal power sector in Chhattisgarh, the Gautam Adani-backed company said.
The proposed transaction, expected to complete by October 31, 2022, has an enterprise value of Rs.7017 crore. The takeover is subject to approval from the from the Competition Commission of India (CCI) and any other approvals as may be identified following the due diligence exercise to be conducted with respect to Diligent Power Pvt Ltd (DPPL) and DB Power Ltd.
DPPL, it may be noted, is the holding company of DB Power Ltd. The acquisition therefore technically means a buy-out of 100 per cent of the total issued, subscribed and paid-up equity share capital and preference share capital of DPPL, by Adani Power Ltd.
Also read: Adani Power To Amalgamate Six Subsidiaries With Itself
DB Power was incorporated in October 2006 and recorded a sales turnover of Rs.3488 crore in FY22, following Rs.2,930 crore in FY21 and Rs.3,126 crore in FY20.
Featured photograph shows an overview of DB Power’s 2×600-mw coal-fired power plant in Chhattisgarh. (Photo: L&T Sargent-Lundy)
