Greenko, backed by GIC Holdings Pte Ltd, Abu Dhabi Investment Authority, and Japan’s ORIX Corp, has completed the acquisition of the 110-megawatt (MW) Chuzachen hydro-electric project in east Sikkim from GI Hydro.
The deal, valued at an enterprise value of ₹1,000 crore, includes an equity value of ₹300 crore, according to two people familiar with the development.
Commissioned in May 2013, the hydroelectric facility harnesses power from two interconnected reservoirs located on the Rangpo and Rongli rivers.
Mint had earlier reported that Greenko Group was considering the acquisition of GI Hydro’s 110 MW Chuzachen project.
Queries mailed to Greenko and GI Hydro remained unanswered till press time.
Greenko, known for its extensive operations in the renewable energy sector, has a notable presence in the hydro projects segment, boasting an operating capacity of 1,789 MW across 25 projects in Himachal Pradesh, Uttarakhand, Karnataka, and Sikkim.
The Hyderabad-based company already operates the 96 MW Dikchu hydro-electric project in Sikkim, a greenfield project on the Dikchu river.
Sikkim offers significant potential for hydroelectric projects due to its lengthy rainy season stretching from February to October. However, the severe winter conditions, with temperatures dropping to as low as minus 4 degrees Celsius around the Dikchu project area, can affect power generation.
Sikkim is home to several other hydroelectric initiatives, including the 96 MW Jorethang Loop Hydro Electric Project by Dans Energy Pvt Ltd and NHPC’s operational 60 MW Rangit III and 510 MW Teesta V projects. Additionally, Teesta Urja Ltd (TUL) is progressing on the 1200 MW Teesta III Hydro Electric Power Project, a public-private partnership with the state government holding a 51% equity stake.
GI Hydro, formerly Gati Infrastructure Pvt Ltd. (GIPL), was set up by M K Agarwal & associates, along with Amrit Jal Ventures P Ltd. (AJVPL), to undertake the 110 MW run-of-the-river project in Sikkim, granted under a 35-year implementation agreement with the government of Sikkim and Sikkim Power Development Company (SPDC).
The company has been struggling financially, having defualted on loan repayments in 2016. Last December, media reports said that the company was looking to raise ₹975 crore through bond issuance to clear its debts.
In January, CareEdge Ratings assigned a ‘CARE D’ rating to a ₹229.23 crore long-term bank facility availed by GI Hydro, citing continued non-cooperation from the company. This followed a decision in November 2022 to categorize GI Hydro’s rating as ‘issuer non-cooperating’ due to the company’s failure to provide necessary information for rating monitoring and its non-payment of surveillance fees as per their agreement.