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Essar Power Transmission likely to be sold to Adani Group; deal may be valued at Rs 1,800 crore |
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NEW DELHI: In an attempt to bring down its debt, the Essar Group is in talks with Adani group to sell Essar Power Transmission, reported ET Now. The deal is expected to be valued at around Rs 1,800 crore, the channel said.
Essar Group's debt is close to over Rs 80,000 crore. "The group has put its power transmission business on the block. They are currently in talks with Adani Group to sell 100% stake in Essar Power Transmission business, which is a wholly owned subsidiary of Essar Power," ET Now reported.
According to ET Now, the deal is expected to be completed by September-December. "The deal will require regulatory approval to transfer licence from Essar to Adani. It will also require approval of lenders, including REC and PFC," the channel added.
ET Now went on to say that the deal makes business sense for Adani group, which is currently setting up a power plant in Chhindwara in Madhya Pradesh. "Essar's transmission line from Hazira to Madhya Pradesh will make immense sense for Adani, which recently demerged its transmission business as a separate entity," the channel said.
Meanwhile, Essar Oil will this week sign a final term sheet with Russia's OAO Rosneft to import 10 million tonnes of crude oil a year for 10 years after an initial deal was signed in December. In parallel, the two sides are negotiating for Rosneft to buy a large stake in Essar Oil, according to people familiar with the matter.
Rosneft, the world's largest publiclytraded oil company, signed an MoU for a multi-year crude supply deal with Essar Oil during Russian President Vladimir Putin's visit to India last December. This was to secure and diversify supply lines for Essar's 4,00,000 barrels per day (bpd) Vadinar refinery. At the same time, it gave Rosneft and Russia a toehold in Asia's third-largest economy. Rosneft and ONGC have been long standing partners in various hydrocarbon projects in Russia.
Subsequently steel-to-BPO conglomerate Essar, pitched a deeper equity alliance to Rosneft by offering a strategic stake of 50% minus 1 share in Essar Oil at a $7-$8 billion (Rs 42,000-Rs 48,000 crore) valuation. ET in its March 25 edition was the first to report the talks between the two for what could culminate in a strategic deal.
Source : economictimes.indiatimes.com
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