Torrent Power Ltd has agreed to acquire 100% equity and convertible instruments in Nabha Power Ltd from L&T Power Development Ltd, a wholly owned subsidiary of Larsen & Toubro.
Nabha Power is a wholly owned subsidiary of L&T Power Development.
The business described the divestiture as a value monetisation effort, citing Nabha Power’s long-term power purchase agreement and consistent operating performance.
The action is in line with L&T’s aim to quit the development project business.
“The divestment aligns with L&T’s strategic objective of unlocking value to strengthen our core businesses,” Chairman and Managing Director S N Subrahmanyan said.
Torrent Power Chairman Samir Mehta said the acquisition marks the company’s entry into the northern India power market and will be value accretive from the first year.
Deal will increase Torrent Power’s operational capacity to 6.4 GW from 5 GW
EY was the exclusive adviser to L&T.
Nabha Power owns and operates a 1,400 megawatt supercritical coal-fired thermal power plant at Rajpura in Punjab’s Patiala district. The plant was commissioned in 2014 under the Government of India’s Case II competitive bidding guidelines.
The transaction is subject to regulatory approval.
