Financial Briefs

India and overseas

Powergrid acquires Ramgarh New Transmission for Rs 56.1 million

The Power Grid Corporation of India (Powergrid) has acquired Ramgarh New Transmission Limited (RNTL), a special purpose vehicle (SPV) set up by REC Limited, for an aggregate value of Rs 56.1 million. RNTL is an SPV formed to implement the Transmission System Strengthening Scheme for the Evacuation of Power from Solar Energy Zones in Rajasthan (8.1 GW) under Phase II-Part A. The scope of work includes the setting up of the 400/220 kV Ramgarh II substation, and the 400 kV D/C Ramgarh II pooling station (PS)-Fatehgarh II PS and Ramgarh II PS-Jaisalmer II lines. Powergrid, through the SPV, will set up the transmission project on a build-own-operate-aintain basis, and complete it within 18 months. In a separate development, Jaiprakash Power Ventures Limited (JPVL) has announced plans to sell a 74 per cent stake in Jaypee Powergrid Limited (JPL) to Powergrid. The sale of JPL, a joint venture (JV) between Powergrid and JPVL, is expected to be completed by March 31, 2021.

REC raises $500 million through bonds

REC Limited has raised $500 million through the issuance of bonds under its $7 billion global medium-term note programme, which would be used to provide finance to the power sector. The notes will mature on September 1, 2026, and all principal and interest payments will be made in US dollars. The settlement date for the notes is expected to be March 1, 2021. The notes represent direct, unconditional and unsecured obligations of the issuer and will rank pari passu among themselves and all other unsecured obligations of the issuer. The notes will be listed on the London Stock Exchange, the International Securities Market, the Singapore Exchange, and the Global Securities Market of India International Exchange (India INX) and NSE IFSC.

Siemens acquires 99.22 per cent in C&S Electric for Rs 21 billion

Siemens Limited has completed the acquisition of 99.22 per cent equity shares in C&S Electric Limited from the company’s promoters for Rs 21 billion. The transaction is aimed at gaining access to the Indian market and creating an export hub. Regulatory approval was received from the Competition Commission of India in August 2020.

IndiGrid signs agreement to acquire NER II Transmission Limited

IndiGrid has signed a share purchase agreement to acquire 100 per cent equity stake in NER II Transmission Limited from Sterlite Power for about Rs 46.25 billion. The acquisition will increase IndiGrid’s assets under management by about 34 per cent to over Rs 200 billion. With this, the platform’s asset portfolio will comprise 13 transmission projects, with a total network of 38 transmission lines and 11 substations comprising over 7,570 ckt. km and a capacity of 13,350 MVA.

JSW Energy signs deal for the sale of an 18 MW TPP to JSW Cement

JSW Energy has signed a business transfer agreement with JSW Cement for the sale of an 18 MW TPP at Salboni in West Bengal for Rs 956.7 million. Earlier, JSW Energy’s board had approved the sale of the TPP to JSW Cement on a going concern basis, subject to necessary approvals. The company has stated that the transaction is a related-party transaction and is carried out at arm’s length based on valuation by an independent registered valuer.

Reliance Power-JERA JV achieves financial closure for 745 MW Bangladesh project (Bangladesh)

Reliance Power Limited, along with partner JERA of Japan, has achieved financial closure for its 745 MW gas-based combined cycle power project in Bangladesh by tying up funds with a group of lenders including the Japan Bank for International Cooperation and the Asian Development Bank (ADB). In 2019, Reliance Power had announced a debt restructuring deal with the Export Import Bank of the US for its Samalkot project in Andhra Pradesh, which was rendered defunct due to the lack of gas supply. The company decided to relocate the project to Bangladesh and inducted the Japanese utility as a partner.

South African government allocates ZAR 88 million for Eskom’s restructuring (South Africa)

The South African government has allocated ZAR 56 billion to state-owned power utility Eskom Holdings SOC Limited for 2020-21. Of this, equity allocations of ZAR 6 billion had been provided till September 30, 2020. The utility has been allocated a further ZAR 31.7 billion for 2021-22. The funds will be utilised for ensuring financial stability of the utility while the government restructures it into three separate entities. As per the restructuring road map presented in November 2019, the vertically integrated utility plans to unbundle into three separate utilities, for generation, transmission and distribution, by end-2022.

Adani Green raises $1.35 billion debt financing for its renewable energy portfolio

Adani Green Energy Limited has raised $1.35 billion (Rs 97.93 billion) debt from 12 international banks for financing its under-construction renewable energy assets. The 12 lenders are Standard Chartered Bank, Intesa Sanpaolo, MUFG Bank, Sumitomo Mitsui Banking Corporation, Coöperatieve Rabobank U.A., DBS Bank Limited, Mizuho Bank Limited, BNP Paribas, Barclays Bank PLC, Deutsche Bank AG, Siemens Bank GmbH and ING Bank N.V. The revolving project finance facility, the first green hybrid project loan in India, will initially finance 1.69 GW of solar-wind hybrid projects, to be set up in Rajasthan. The latest round of funding is expected to help the company scale its capacity to 25 GW by 2025.

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