JSW Energy to buy Jindal Steel’s 1,000 mw plant for Rs 6,500 cr

JSW Energy to buy Jindal Steel’s 1,000 mw plant for Rs 6,500 cr

FPJ BureauUpdated: Friday, May 31, 2019, 03:44 PM IST
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JSW is also in talks to buy Jaiprakash’s 500 mw thermal power plant in MP and Monnet Ispat’s plant in Odisha

New Delhi : Billionaire Sajjan Jindal’s JSW Energy will acquire a 1,000 mw power plant from his younger brother Naveen-led heavily indebted Jindal Steel and Power Ltd for Rs 6,500 crore. JSW will pay at least Rs 4,000 crore, excluding net current assets, and an additional Rs 2,500 crore if JSPL’s 1,000 mw power plant in Raigarh, Chhattisgarh secures a long term power purchase agreement, the firms said.

Sajan and Naveen, sons of billionaire Savitri Devi Jindal, once competed to buy foreign assets, but JSPL has run into rough weather with Supreme Court cancelling its coal mine allocations and weak global commodity prices. JSPL, which has a debt of close to Rs 46,000 crore, said the deal, to be completed by mid-2018, would help meet its liabilities while JSW gained a foothold in coal-rich Chhattisgarh. JSW would also extend Rs 500 crore as advance against interest.

The buyout by JSW comes close on the heels of its acquisition of Jaiprakash’s 1,391 mw hydro-power plants. JSW is also said to be in talks to acquire Jaiprakash’s 500 mw thermal power plant in Madhya Pradesh and Monnet Ispat & Energy Ltd’s 1,050 mw power plant in Odisha.  These buyout would help JSW to expand its power portfolio to a planned 11,500 mw. “The adverse operating environment within power sector in the country is driving distress sales in the sector, and JSW Energy’s robust financial health coupled with a strong balance sheet is providing the company an opportunity to acquire quality power assets at reasonable valuations…” JSW said.

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