The Maharashtra Electricity Regulatory Commission (MERC) on Thursday reserved its order on the sale of Reliance Infrastructure's Mumbai power business to Adani Transmission, a deal that is expected to leave the Anil Ambani-led company with a ₹3,000-crore surplus..

“MERC has reserved its order which is expected to be delivered in the next few weeks,” Reliance Infrastructure said in a statement.

The company has already received approval from the Competition Commission of India and its shareholders for the deal. As BusinessLine reported last month, the MERC approval is the last in a series of regulatory approvals.

In December 2017, Reliance Infrastructure signed binding share purchase agreement for its integrated business of generation, transmission and distribution of power for Mumbai.

The deal value was set at ₹13,251 crore. However, considering the regulatory assets under approval are estimated at ₹5,000 crore and net working capital on closing is estimated at ₹550 crore, the total consideration value has reached ₹18,800 crore, according to Reliance Infrastructure.

Adani Transmission has already advanced ₹2,602 crore to RInfra as part of the deal, as per the company’s regulatory filings.

Reliance Infrastructure intends to use the proceeds to reduce its debt of around ₹15,000 crore and become a ₹3,000 crore cash surplus company. “EPC and Defence are two major verticals the company will focus on going forward,” Reliance Infrastructure spokesperson noted.

Reliance Infrastructure’s Mumbai Power business known as Reliance Energy is an integrated power utility distributing power to nearly three million residential, industrial and commercial consumers and covering an area of 400 sq km.

Published on June 14, 2018