Comments
GMR Energy, a subsidiary of GMR Infrastructure Ltd, has decided to step back from tapping the market with an initial public offer (IPO).
The company, which had filed a draft red herring prospectus on March 28 with the Securities and Exchange Board of India, on Monday, along with its stakeholders who plan to offload stakes, decided to withdraw the DRHP.
Without getting into details, GMR Infrastructure said the move to withdraw the proposed IPO is based on various business reasons.
Part of diversified GMR Infrastructure Ltd, GMR Energy had initiated the process of raising funds through an IPO. The company was considering raising ₹1,400-1,500 crore to part-fund its expansion plans as well as to pare its debt.
GMR Infrastructure is the holding company formed to fund the capital requirements of various projects across the sectors. It undertakes the development of infrastructure projects through its various subsidiaries.
GMR Energy commands a portfolio of over 15 power projects, of which eight are operational and seven others under various stages of development.
Investors The company, which has interests in airports, energy, highways and urban infrastructure sectors, has invested significantly in power projects over the years.
Marquee investors, such as IDFC and Temasek Holdings, a Singapore Government-promoted investment arm, have invested in these power projects.
The infrastructure company has adopted an “asset light, asset right” strategy and is seeking to churn some of its projects. By divesting stake in some of the matured projects, it is in the process of not only repaying part of its debt but also reinvesting the freed-up equity for new projects.
May hike stake According to sources, some of the existing investors may hike their stakes in the company on the strength of its broad portfolio of power assets. These projects include Emco, Kamalanga and the gas-based power project Vemagiri.
Most of the independent power generation companies are finding the going tough due to shortage of fuel supplies.
GMR has divested stakes in several projects in order to pare its debts. These include a power project in Singapore, several road projects, a couple of power assets and an overseas airport asset.
GMR Infra shares closed the day at ₹26.35, up 2.35 per cent.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.