Reliance Power shares up on Jaiprakash hydro-power buy
Posted on Jul 28 2014 | IANS
Mumbai, July 28 : The shares of Reliance Power rose Monday on news that it will buy the entire 1,800 MW hydro-power portfolio of the Jaiprakash Group for over Rs.10,000 crore in India's biggest deal in the infrastructure space other than telecom.
"Reliance Power signs exclusive memorandum of understanding to acquire 100 percent of entire hydro power portfolio of Jaiprakash Power Ventures," the company said Monday in a filing with the Bombay Stock Exchange (BSE).
The deal has been signed by Reliance CleanGen (RCL), a 100 percent subsidiary of Reliance Power, and Jaiprakash Power Ventures (JPVL), a subsidiary of Jaiprakash Associates (JAL), the company said.
"JPVL's hydroelectric power portfolio has an aggregate capacity of nearly 1,800 MW, fully in operation, the largest in the private sector in India, and with an asset base of over Rs.10,000 crore," Reliance Power said.
"The portfolio comprises three plants, with an asset life of over 50 years, each using run-of-the-river technology to convert natural water flow to electricity."
The acquisition would make Reliance Power India's largest private power company with 7,800 MW operating capacity by end of the current fiscal.
With the news coming in before the start of trading session Monday, the shares of Reliance Power opened higher at Rs.93, compared with the previous close of Rs.90.80 in an otherwise dull market, where a key index was trading at a loss.
The shares rose further to Rs.93.60 intra-day and was trading at Rs.92.90 at noon. Jaiprakash Power Ventures on the other hand was quoting at Rs.19.75 with a gain of 4.22 percent.