QIA picks 25% stake in Adani’s Mumbai power transmission biz

Our Bureau Mumbai | Updated on December 11, 2019

Qatar will invest ₹3,200 crore

Qatar Investment Authority (QIA), the sovereign wealth fund of Qatar, will invest ₹3,200 crore for a 25.1 per cent stake in Adani Electricity Mumbai Ltd (AEML). The deal also includes subordinated debt investment by QIA in AEML.

Subordinated debt is an unsecured loan that's paid after all other corporate debts and loans are repaid, in case a borrower defaults.

AEML is into the power distribution, transmission and generation business that serves more than 30 lakh consumers across 400 sq km in Mumbai.

As part of the transaction, Adani Transmission Ltd and QIA have agreed to ensure that over 30 per cent of the electricity supplied by AEML will be sourced from solar and wind power plants by 2023.

Customer satisfaction

Adani Group Chairman, Gautam Adani, commented: “Together, we will continue to work towards improving the reliability of supply and consumer satisfaction for over three million AEML consumers served in Mumbai.”

QIA Chief Executive Officer, Mansoor Al-Mahmoud, said:“This investment demonstrates our confidence in India, with which Qatar shares deep-rooted ties and excellent relations”. This marks the entry of QIA in the Indian power sector. Earlier this year, QIA had invested $150 million in Byjus, the learning app.

The investment comes at a time when Tata Power and AEML that cater to Mumbai consumers increased the tariff by 2 per cent and 1 per cent respectively. However, AEML, in a statement, had said that among all the discoms, AEML has witnessed lowest tariff hike of 1 per cent. AEML is the largest private power distributor in Mumbai, which counts over 27 lakh residential, commercial and industrial customers.

In Mumbai, Tata Power tariff rates are cheaper for consumption up to 300 units, and the AEML rates are cheaper for consumption beyond 301 units.

Published on December 11, 2019

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