The Competition Commission of India (CCI) approved the acquisition of 49% stake in Odisha Power Generation Corporation Ltd (OPGC) by Odisha Hydro Power Corporation Limited (OHPC) on Tuesday.
State-owned OHPC had sought the CCI’s nod to acquire the stake from US-based AES Corporation for $135 million (about Rs 1,000 crore) last month.
The Odisha state government, which holds 51% stake in OPCG, had blocked Adani Power Ltd (APL) from acquiring the AES stake by invoking its right of first refusal in August.
In June, APL had entered into a share sale and purchase agreement with AES for its 89,30,237 equity shares in OPCG.
The deal will involve the acquisition of OPCG equity shares from AES OPGC Holding and AES India, pursuant to the share sale and purchase agreement, an official statement said.
“The proposed combination will enable OHPC to explore further strategic growth through unlocking the potential of OPGC in the power sector in India,” the notice filed with the CCI said.
The business activities of the two parties horizontally overlap in the market for power generation in India, but the combination would not adversely affect competition in the market, OHCP said in the notice.
While OHPC is engaged in the business of hydroelectric and solar power generation, OPCG is engaged in power generation through coal-based thermal power plants and mini-hydropower projects.
As per the right of first refusal agreement, the state government was supposed to make the payment of the agreed share value to AES within 90 days of the offer.
However, the payment was held up beyond the expiry date of November 26, on account of the pending approval from the competition regulator.
The deal will be completed after the transfer of share certificates and will be followed by a reconstitution of the board of directors of OPCG.
