JSW Energy to buy Bina plant from Jaiprakash Power for ₹2,700 crore

Our Bureau Mumbai | Updated on January 17, 2018

Deal to be completed before May 2017

Sajjan Jindal-controlled JSW Energy has agreed to acquire a 500 MW thermal power plant located in Madhya Pradesh from Jaiprakash Power Ventures for an enterprise value of ₹2,700 crore in an all-cash deal.

The two had announced a binding memorandum of understanding (MoU) in September 2015, when JSW had acquired Himachal Baspa Power Company Ltd, a subsidiary of Jaiprakash Power Ventures, for ₹9,275 crore.

In addition, on May 4, JSW had announced the purchase of Jindal Steel & Power Ltd’s (JSPL) Chhattisgarh thermal power plant for a sum of up to ₹6,500 crore. Shareholders of Jindal Steel gave their approval to the disinvestment on Monday.

“With the passing of these resolutions, we are confident of strengthening our balance sheets, while we work to fully utilise our capacities in steel and power,” said Naveen Jindal, Chairman of Jindal Steel and Power Ltd, in a statement on Monday.

Increased capacity

With the latest move, the operational power generation capacity of JSW Energy will increase to 6,031 MW.

This is part of JSW’s plan to achieve power generation capacity of 10,000 MW by 2020.

“The proposed acquisition of an operational power plant at Bina, based on domestic coal linkage with over three years of operational track record, is a right fit to the existing portfolio of power generating assets.

“The acquisitions will enable the diversification of geographical footprint and fuel source, thereby strengthening the existing business model,” JSW Energy said in a statement. It added that the deal is expected to be completed before May 31, 2017.

In 2015-16, the Bina plant had generated ₹895 crore in revenues compared to ₹1,232 crore in the previous year.

In a separate deal, JSW Eneregy also announced the acquisition of Minerals & Energy Swaziland (Pty) Ltd for $1.5 million.

The company has rights over a coal bearing area of 8000 hectare in Swaziland. This deal is expected to be concluded by September 30, 2016.

Published on July 18, 2016

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