India’s Reliance Infrastructure (RInfra) has signed an agreement to divest 100% stake in its transmission assets to private power transmission company Adani Transmission (ATL) in a bid to reduce debt.
Upon completion by the end of this year, Adani Group subsidiary ATL will have 100% stake in Western Region Strengthening System Scheme (WRSSS) B & C projects located in the state of Maharashtra, Gujarat, Madhya Pradesh and Karnataka.
It will also acquire 74% in Parbati Koldam Transmission Company (PKTCL) located in the state of Himachal Pradesh and Punjab.
PKTCL is a joint venture between R-Infra and Power Grid Corporation of India (PGCIL).
RInfra said that the proceeds from the sale will be used entirely to reduce debt, without disclosing the deal value.
Reliance Infrastructure said in a statement: “The transaction is in line with the strategic plan of monetizing non-core business and focus on major growth areas like Defence and engineering, procurement and construction (EPC) business.”
The deal is subject to due diligence, definitive documentation, applicable regulatory approvals and certain other conditions.
Adani Group chairman Gautam Adani said: “With this acquisition, ATL will enjoy substantial benefit of scale driving and is in sync with the deep-rooted strategy of ATL to enhance the value for the stakeholders through both organic as well as inorganic growth.”