Tenaga to invest $300 mn in GMR Energy’s assets
With this deal, GMR Infra would be able to reduce it corporate debt to Rs 4,300 crore from the current Rs 6,300 crore.
Debt-laden GMR Infrastructure on Monday said that Tenaga Nasional, the largest power utility in Malaysia, has agreed to invest $300 million (approximately Rs 2,000 crore) for a 30 per cent stake in selected generation assets of its subsidiary company GMR Energy (GEL). The proceeds from the stake sale would be used for repayment of corporate debt, the company added.
With this deal, GMR Infra would be able to reduce it corporate debt to Rs 4,300 crore from the current Rs 6,300 crore. “This would lead to a reduction in GMR Infra’s consolidated corporate debt and will result in a stronger balance sheet,” the statement said.
“We will use the entire proceed towards debt reduction which will allow us to save nearly Rs 250 crore in interest payment annually,” GBS Raju, chairman, GEL said in a conference call. GMR Infra’s gross debt stood at Rs 47,738 crore at the end of March 2015. This debt is through various special purpose vehicles the company operates in various verticals it is present in like roads, airports etc. It said that it is able to service the debt in the various SPVs and will now be able to reduce it at the corporate level also.
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In March, GMR Infrastructure had agreed to sell a 51 per cent equity stake in its 99-km highway project in Karnataka to its joint venture partners for Rs 85 crore. Before that in December, it had raised $300 million by issuing 60-year foreign currency convertible bonds to Kuwait Investment Authority.
A Credit Suisse report has placed the company among the 10 most heavily indebted firms and said that it had sold assets worth about Rs 11,000 crore since 2012 till the end of last fiscal.
Under the deal, Tenaga will hold 30 per cent stake in total capacity of 4,600 MW. This includes 2,300 MW of operational capacity and rest is under development. The operational capacity consists of 1,650 MW of coal-based assets and 623 MW of gas-based plants. The deal will cover all the under-development projects, dominated by hydro power capacity with two being in Nepal.
The company, however, kept over 2,000 MW of capacity outside the purview of this deal. The assets include recently commissioned coal-based plant in Chhattisgarh with a capacity of 1,370 MW and fuel-starved gas-based plant at Rajamundhry in Andhra Pradesh with a capacity of 768 MW. GEL operates nearly 6,500 MW of capacity which includes 4,200 MW being operational. Tenaga, a $10-billion company, was established in 1990 as a public company.
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