The specified business is to be carved out on a going concern basis into a separate SPV
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Mumbai: The Public Sector Pension Investment Board (PSP Investments), one of the largest pension fund managers in Canada with C$112.0 billion (approx. Rs6.5 lakh crore) of net assets under management as of March 31, 2015, has acquired a 49 per cent equity stake in Reliance Infrastructure Ltd’s integrated power generation, transmission and distribution business in Mumbai city and adjoining areas.
The specified business is to be carved out on a going concern basis into a separate SPV, in which RInfra will own the controlling 51 per cent stake, and PSP Investments will own 49 per cent. RInfra said that it would use the proceeds of this deal to retire 70 per cent of their debt which is around Rs 16,000 crore. This is part of the ongoing measures to redeem the group’s debt by inducting strategic partners, the company spokesman said.
Reliance Infrastructure’s Mumbai power business (known as Reliance Energy) distributes power to nearly three million residential, industrial and commercial consumers in the suburbs of Mumbai. It covers an area of 400 sq km, and caters to a peak demand of over 1,800 MW and has got a revenue of Rs 7,700 crore in the financial year 2014-15.
The company said the exclusivity agreement is valid till March 31, 2016. The proposed transaction is subject to due diligence, definitive documentation, applicable regulatory and other approvals and certain other conditions. “Accordingly, there can be no certainty that a transaction will result,” the company added.
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( Source : deccan chronicle )
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