The Hindu Business Line : Bhilwara Group to offload 49 pc in Malana Power to foreign partner

THE LNJ Bhilwara Group has initiated a restructuring of its hydro-power business. The group has two projects - 90 MW Malana Power project which has been operational for the last three years and a 200 MW Allan Duhangan project, under a new company called AD Hydro Power Ltd.

The group has now decided to offload up to 49 per cent stake in Malana Power to a foreign partner. Also, Malana will acquire 90 per cent stake in AD Hydro, while the remaining 10 per cent will be offloaded to the World Bank arm, International Finance Corporation.

"We see immense potential in the area of hydro power. In the Malana project, we have invested Rs 350 crore in a mixture of debt and equity. Now Malana will acquire 90 per cent stake in AD Hydro, while the remaining 10 per cent will be offloaded to IFC," the LNJ Bhilwara Group Chairman, Mr Ravi Jhunjhunwala, told Business Line.

He said the Allan Duhangan project is worth Rs 900 crore and will be funded with 65 per cent debt component.

"Of the total Rs 585-crore debt we will bring in this project, IFC will contribute Rs 184 crore, which is in addition to the 10 per cent equity stake the corporation will take. The remaining debt will be taken from domestic financial institutions and banks," he said.

On offloading minority stake in Malana to a foreign partner, Mr Jhunjhunwala said the group was negotiating with several hydro power majors and that a joint venture was likely over the next three months.

Mr Jhunjhunwala said a couple of more such hydro power projects were at the drawing board stage and that the group will put in a total of Rs 1,050 crore in hydro power projects over the next three years as a mixture of debt and equity.

Besides hydro power, the LNJ Bhilwara Group is a major player in textiles, suitings and graphite electrodes. The group is targeting Rs 3,000-crore turnover within the next three years from a little over Rs 1,800 crore last fiscal.

More Stories on : Mergers & Acquisitions | Power

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