JSW Energy acquires GMR Kamalanga Energy for Rs 5,321 crore

Sajjan Jindal-backed JSW Energy Ltd has acquired GMR’s Kamalanga Energy Ltd for Rs 5,321 crore (US$ 761.34 million). The total installed power generation capacity of JSW Energy will increase to 5,609 MW after the acquisition.

The acquisition was announced by JSW Energy in October 2019. GMR Kamalanga Energy Ltd is a subsidiary of GMR Energy Ltd and operates a 1,050-MW thermal plant in Odisha. This is an all-cash deal and consists of three plants with 350 MW capacity each, located at Dhenkanal district in Odisha, with revenues of Rs 2,195 crore (US$ 314.06 million).

This acquisition will increase the JSW Energy’s presence in the eastern region and diversify its fuel mix and offtake arrangements.

The approvals are needed for the acquisition from the Competition Commission of India, lenders of GMR Kamalanga Energy, Uttar Haryana Bijli Vitran Nigam, and PTC India. Deal is expected to go through in three months. The lenders include IDFC, SBI, IDBI, UCO and Canara Bank.

Last year, JSW Energy had acquired Ind Barath under the corporate insolvency proceedings. Although, final approval from the NCLT is waited for this deal.

“In our view, both the acquisitions are value-accretive and can lift return on equity by 250 bps over the next two years,” said a note by Edelweiss Research.

A mixed strategy is been taken by JSW Energy in order to enhance traditional thermal power, along with renewable energy, with its bets on hydro and solar.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.