Tube Investments to pick up controlling stake in troubled CG Power for Rs 700 crore

Tube Investments of India (TII), part of Chennai-based diversified business conglomerate Murugappa Group, will pick up a controlling stake in the asset-stressed CG Power and Industrial Solutions for a consideration of Rs 700 crore. CG Power, engaged in the industrial and power sectors, is under financial stress and its lenders have initiated the resolution process of stressed assets in terms of prudential framework.

As a first step towards the commencement of the bidding process, TII and CG Power entered into a securities subscription agreement on Friday for an investment of around Rs 700 crore in the latter to acquire a 51% stake through a combination of investment of around Rs 550 crore for primary subscription to the equity shares and around Rs 150 crore for primary subscription to warrants.