Power Grid Corporation of India (PGCIL), in a recent stock exchange communication, said that it has signed the share purchase agreement (SPA) to acquire equity stake in Jaypee Powergrid Ltd (JPL), for around Rs.350 crore.
PGCIL said that it has signed the SPA with Jaiprakash Power Ventures Ltd (JPVL) to acquire 74 per cent stake in JPL owned by JPVL, for an aggregate consideration of Rs.351.65 crore. The filing noted that this was the “closing date payment” and will be subject to adjustment in accordance with relevant clauses in the SPA.
On completion of this transaction, Jaypee Powergrid Ltd will become a wholly-owned subsidiary of PGCIL.
Background
It may be recalled that on February 12, 2021, the board of directors of PGCIL approved the acquisition of the entire equity 74 per cent stake of JPVL held in Jaypee Powergrid Ltd. PGCIL had earlier obtained the concurrence of Niti Aayog for this acquisition.
Also read:PGCIL Acquires Ramgarh New Transmission Ltd
JPL was incorporated on October 5, 2006, as a joint venture between JVPL (equity: 74 per cent) and PGCIL (equity: 26 per cent). It was formed to implement specific power transmission infrastructure associated with Jaypee Group’s 1,000-mw Karcham-Wangtoo hydropower project in Himachal Pradesh. The JPL started commercial operations on April 1, 2012 and recorded a sales turnover of around Rs.160 crore in FY20.
The Karcham-Wangtoo hydropower, located on River Sutlej, in Kinnaur district of Himachal Pradesh has been in operation since September 2011. It was commissioned by Jaypee Group but was later acquired by JSW Energy.
PGCIL JVs
Way back in March 2006, PGCIL announced that it was willing to form joint ventures with IPPs (independent power producers) for setting up transmission infrastructure associated with their power generation plants. Accordingly, it entered into MoUs with five IPPs to set up such joint ventures. The IPPs were Essar Power, Torrent Power, Teesta Urja (Athena Group), Jaypee Group and ONGC Tripura Power.
Some of the JVs were subsequently formed. As of March 31, 2019, PGCIL had three such JVs in operation—Torrent Powergrid Ltd, Jaypee Powergrid Ltd (now proposed to be taken over) and Teestavalley Power Transmission Ltd.
(Featured photograph, sourced from voitch.com shows an aerial view of the 1,000-mw Karcham Wangtoo hydropower project in Himachal Pradesh)
