The sale is a part of deleveraging strategy following which Essar has repaid over Rs 1.8 lakh crore to banks and financial institutions in the last three years – the largest debt repayment in the history.
In a statement, Essar Power said it “has entered into a definitive agreement with Adani Transmission Ltd to sell one of its two transmission lines for Rs 1,913 crore”.
Essar Power Transmission Company Ltd (EPTCL), a unit of Essar Power, has 465-km transmission lines across three Indian states. The asset transacted is an operational 400 kV inter-state transmission line linking Mahan to the Sipat pooling substation.
The project operates under the CERC regulated return framework.
During the last three years, Essar Power has reduced its debt from a peak level of Rs 30,000 crore to Rs 6,000 crore, the statement said, adding the firm has been in the process of curating a green balance sheet around renewable energy, which is in line with the group’s strategy of investing in future-centric businesses that give a superior rate of return within the ESG framework.
Kush S, CEO of Essar Power Ltd said, “With this transaction, Essar Power is rebalancing its power portfolio with the twin objective of deleveraging its balance sheets and investing in green and renewable power, thereby furthering its ESG-oriented future growth”.
Essar Power has a current power generating capacity of 2,070 MW across four plants in India and Canada.
It is one of India’s first private sector independent power producers.
Meanwhile, ATL MD & CEO Anil Sardana in a statement said: “The acquisition of Essar’s transmission asset will consolidate ATL’s presence in central India. With this acquisition, ATL is well on the path to achieve its 20,000 ckt km target before time. We continue to remain at the forefront of grid stability and provide sustainable, reliable, and affordable energy solutions while creating long term sustainable value for our stakeholders”.
With this acquisition, the cumulative network of ATL will reach 19,468 ckt km, out of which 14,952 ckt km is operational and 4,516 ckt km is under various stages of execution.