JSW Energy has decided to terminate its resolution plans to take over the stressed thermal power asset Ind-Bharat Energy (Utkal), according to an exchange notification from the company on Tuesday. The company said that a “material adverse event” that took place during the 15 months after the plan was submitted has led it to withdraw its resolution plan.
JSW had offered ₹1,000 crore for the Ind-Bharat assets.
“We wish to inform you that the company had submitted a Resolution Plan to the Committee of Creditors for the Corporate Insolvency Resolution of Ind-Barath Energy (Utkal) Ltd on 3rd October 2019,” the notification said. “As informed vide letter dated 14th October 2019, the Resolution Plan was approved by the CoC on 14th October 2019 and the Resolution Professional filed an application to the National Company Law Tribunal for approval of the same.
“In the intervening period of more than 15 months since the submission of the Resolution Plan, a Material Adverse Change (MAC) event, as defined under the Resolution Plan has occurred. A MAC event entitles the Company to terminate the Resolution Plan.”
A person aware of discussions within JSW Energy said the withdrawal was because of deterioration in the value of assets held by Ind-Bharat after the resolution plan was submitted.
Ind-Barath owns a 700 megawatts (MW) under-construction thermal power plant located in Odisha. Last year, JSW Energy also terminated talks with the GMR group to take over its stressed 1050 MW Kamalanga plant in Odisha’s Dhenkanal district saying it was no longer a strategic fit.
JSW Energy is a private sector power producer and part of the $12 billion JSW Group controlled by Sajjan Jindal. It has power generation capacity of 4,559 MW having a portfolio of thermal 3,158 MW, Hydel 1,391 MW and Solar 10 MW.