Renascent Power Ventures to acquire 75% stake in Prayagraj Power Project following APTEL approval

TATA Power has recently announced that the Appellate Tribunal for Electricity (APTEL) has approved the acquisition of 75% stake in the 1,980 MW Prayagraj power project by by Renascent Power Ventures, a subsidiary of its joint venture Resurgent Power Ventures Pte Ltd.

The company mentioned that APTEL did not approve the reduction of adopted power tariff for the project. Renascent Power Ventures had reportedly offered reduced tariff in the power purchase agreements to customers.

The Competition Commission of India had reportedly approved the share purchase agreement signed by Resurgent Power Ventures Pte Ltd for the acquisition of 75.01% stake in Prayagraj Power Generation Company Ltd (PPGCL).

Apparently, one of the customary closing condition to conclude the transaction was the approval of the regulator.

For the uninitiated, Singapore-based Resurgent Power is a joint venture in which Tata Power holds about 26% stake via its wholly-owned subsidiary Tata Power International Pte based in Singapore. The remaining 74% is held by ICICI bank, Kuwait Investment Authority and Power Platform Ltd.

Sources familiar with the development reported that PPGCL, which owns and operates a 1,980 MW coal-based thermal power plant in Uttar Pradeshand had recently been classified as a Non-Performing Asset (NPA) due to operational and financial stresses.

Praveer Sinha, MD and CEO of TATA Power stated that APTEL’s approval will act as a positive factor for the advancement of the power sector, particularly for the resolution of stressed assets.

APTEL’s judgement effectively safeguards economic viability of stressed assets after resolution, thereby providing certainty for the bidders willing to participate in the resolution of stressed assets in the future, he noted.
According to authentic sources, Resurgent looks forward to closing the transaction at the earliest, concluding the acquisition of Prayagraj Power Project, to boost and enhance the operations of the power plant to bridge the increasing power demand-supply gap in Uttar Pradesh.  

Source Credits –https://economictimes.indiatimes.com/industry/energy/power/aptel-approves-acquisition-of-prayagraj-power-project-by-tata-power-jv/articleshow/71375102.cms