Mumbai: Indian billionaire Sajjan Jindal's JSW Energy is nearing a deal to buy a 1,000 megawatt coal-fired power plant from his brother's debt-laden Jindal Steel & Power for about $782 million, two sources familiar with the matter said.
A deal could be announced as soon as Wednesday, the sources said, though it could be delayed until next week as details, including the final price, have yet to be settled.
Jindal Steel & Power Chief Executive Ravi Uppal said that a deal was being negotitated but declined to give more details.
A JSW spokesperson said the company is evaluating "various growth opportunities" but is not in any specific discussions for any particular projects.
A deal would help to reduce debt at Jindal Steel & Power, majority-owned by Sajjan Jindal's younger brother, Naveen. The company had net debt of 460 billion rupees ($7 billion) at the end of December, nearly eight times the company's current market capitalisation, and has been in talks with lenders to reschedule repayments because of "cash flow mismatches".
The brothers have previously competed to buy foreign assets, but Jindal Steel is now struggling after Supreme Court cancelled its coal mining licences and weak commodities markets hit margins.
The power plant deal would help JSW Energy in its efforts to nearly triple its power generation capacity to about 12,000 MW by early in the next decade.
Jindal Steel and Power commissioned the first of the four 250 MW units at the site in the Raigarh district of Chhattisgarh in 2007, becoming the first private company to set up an independent power plant.
