Kalpataru Power Transmission Ltd (KPTL) announced that it has entered into binding agreements with CLP India Pvt Ltd to sell its stake in three power transmission assets, in a deal that is estimated at Rs.3,275 crore. The transaction is subject to requisite approvals and compliances.
The assets to be divested are:
- Kalpataru Satpura Transco Pvt Ltd (KSTPL)
- Alipurduar Transmission Ltd (ATL)
- Kohima Mariani Transmission Ltd (KMTL)
As a part of this deal, the transaction for ATL and KMTL will be effective post commercial operation date (COD) and fulfillment of certain conditions. Techno Electric & Engineering Company Ltd (Techno) owns 26 per cent stake in KMTL. It may be mentioned that on March 31, 2017, KPTL acquired 100 per cent equity stake in KMTL. However, on May 2, 2018, KPTL entered into a share purchase agreement with Techno, following which Techno acquired 26 per cent equity capital in KMTL from KPTL. On the other hand, KSTPL and ATL are wholly-owned subsidiaries of KPTL.
The estimated amount of debt at the SPVs levels would be approximately Rs.2,000 crore at the time of COD. Ernst & Young (EY) and Khaitan & Co. are advisors to KPTL and Techno for this transaction.
For CLP India, this would be its foray into the field of power transmission. CLP India has been present in India since 2002 and currently has a power generation portfolio of over 3,000 mw comprising renewable energy (wind and solar), as well as conventional (coal and gas-fired) power plants.
Commenting on the asset sale, Manish Mohnot, Managing Director & CEO, KPTL said, “The sale of transmission assets is a landmark event in KPTL’s growth journey. The sale of assets is a milestone and a testament to our ability to create, operate, and hive off the assets at the right moment. The sale of assets will lead to a significant reduction in KPTL’s consolidated debt and will help focus on strategic diversification within core business. KPTL will continue to focus on sustainable and profitable growth with commitment to improve return ratios.”
According to Rajiv Mishra, Managing Director, CLP India, “The Indian market is a primary growth market for CLP and CDPQ and the two companies share a vision to invest only in a low carbon, clean energy portfolio in India. Entering the transmission sector is a landmark for CLP India. The acquisition of the KPTL assets will enable us to expand our geographical reach across the country and reinforces our commitment to grow our investments.”
Of the three transmission assets being sold, two SPVs—ATL and KMTL—are developing interregional lines. The third KSTPL has won the concession for an intrastate power transmission line in Madhya Pradesh.
KSTPL has set up a 240-km 400kV transmission line from Satpura to Ashta, both in Madhya Pradesh. The line is meant to transmit power from the 2×250-mw extension units at the Satpura thermal power station owned by the MP state power generation utility. The company entered into a 25-year TSA (extendable by another 10 years) with Madhya Pradesh Power Transmission Company Ltd on June 6, 2013. The project was commissioned on April 7, 2015.
Haryana project: Kalpataru Power Transmission has another special purpose vehicle Jhajjar KT Transco Pvt Ltd that has developed an intrastate power transmission line in Haryana. This 100km line is operational since March 2012. Jhajjar KT Transco is owned by Kalpataru Power Transmission (51 per cent) and Techno Electric & Engineering Co Ltd. According to information available with T&D India, Jhajjar KT Transco is not being considered for disinvestment at this point in time.
(Featured photograph for illustration only)
