Tata Power’s board has given an in-principle approval for setting up of an InvIT for the company’s renewable business on terms and conditions to be discussed with potential investors.
The company’s long-term strategic plan involves reducing debt thereby strengthening the balance sheet and improving overall return metrics through: divestment of non-core and certain overseas investments; restructuring of some of its businesses to unlock value and simplify the structure of the company and its subsidiaries. Consequent to this, the company has decided to pursue setting up of InvIT for its renewables business; and raising of equity to reduce unsustainable debt in Tata Power and/or its subsidiaries. The company’s board has also approved issuance of 490.5 million equity shares on a preferential basis to Tata Sons Private Limited for an aggregate consideration of Rs 26 billion. The issue price for the equity shares has been fixed at Rs 53 per equity share.