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IndiGrid completes power transmission asset buyout

Mumbai | Updated on March 27, 2021

India Grid Trust, one of the largest power sector infrastructure investment trusts (InvIT), has completed the largest transmission project deal by acquiring NER-II Transmission from Sterlite Power at an enterprise value of ₹4,625 crore.

With this acquisition, IndiGrid’s asset under management has increased by 34 per cent to ₹20,000 crore. The platform’s asset portfolio now consists of 13 power transmission projects, with a total network of 38 power transmission lines and 11 substations extending over 7,570 circuit kilometers and 13,350 MVA in 17 Indian states and Union Territory.

The acquisition of NER-II was envisaged as part of the Framework Agreement signed with Sterlite Power in April 2019. The Investment Manager of IndiGrid had signed a definitive share purchase agreement for the acquisition of NER-II on March 5. Pursuant to this, the unitholders’ approved the transaction unanimously in favour of the acquisition in the Extra-Ordinary General Meeting held on March 19.

The acquisition will add a net distributable cash flow of ₹40-45 crore per annum. NER-II is part of Inter State Transmission Scheme network, and was awarded on a Build, Own, Operate, Maintain basis with a contractual period of 35 years.

The asset spans Assam, Arunachal Pradesh and Tripura and is of strategic importance for the delivery of power in one of the toughest regions in the country. This project will strengthen the power transmission network in the North Eastern States.

Harsh Shah, Chief Executive Officer, IndiGrid, said this fiscal has been a transformational year for IndiGrid with ₹7,500 crore acquisitions across inter and intra state transmission, regulated tariff transmission projects and the first solar project. These accretive acquisitions have increased DPU (distribution per unit) to ₹12.40 per annum.

Going forward, with a robust acquisition pipeline and proposed equity infusion via a rights issue, IndiGrid is ready to capitalise on growth opportunities, he said.

Published on March 27, 2021

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