Adani Transmission on Wednesday entered into an agreement to sell 25.1 per cent stake in its Mumbai distribution business to Qatar Investment Authority (QIA) for Rs 3,200 crore.
The agreement requires the Mumbai distribution business to source 30 per cent power from green alternatives. The transaction is likely to be complete by early 2020, subject to receipt of regulatory approvals and satisfaction of customary conditions.
“Adani Transmission (ATL), Adani Electricity Mumbai (AEML) and a subsidiary of QIA have signed definitive agreements for the sale of a 25.1 per cent stake in AEML to QIA and for a shareholder subordinated debt investment by QIA in AEML,” the two companies said in a joint statement.
AEML is a subsidiary of Adani Transmission and the group’s Mumbai distribution business is housed in AEML.
The statement further said ATL and QIA have agreed to definitive plans to ensure that over 30 per cent of the electricity supplied by AEML is sourced from solar and wind power plants by the year 2023.
“We believe this transaction is a significant step in the journey of the Adani Group, marking the start of a long term partnership with QIA,” said Gautam Adani, chairman for the group.
Mansoor Al-Mahmoud , chief executive officer for QIA added, “We look forward to a long term partnership with the Adani Group, with whom we share an inter-generational perspective on investments and a common vision for the sustainable growth and continued success of AEML”. The transaction is the latest in a series of investments undertaken by QIA in world-class infrastructure assets with trusted partners globally.
SKN Advisors Limited acted as financial advisor and Cyril Amarchand Mangaldas acted as legal advisor to ATL and AEML for the transaction. J P Morgan acted as financial advisor and Cleary Gottlieb Steen & Hamilton LLP and AZB & Partners acted as legal advisors to QIA.
