Reliance buys 26% stake in Adani Power’s unit

Mukesh Ambani’s Reliance Industries has bought a 26 per cent stake in a Madhya Pradesh power project of Gautam Adani, and signed a pact to use the plant’s 500 MW of electricity for captive use. 

This is the first business collaboration between the two billionaires.

Mahan Energen Ltd (MEL), a wholly owned subsidiary of Adani Power Ltd, has agreed to allot five crore equity shares of face value of Rs 10 each of MEL to RIL at par.

The proposed investment by RIL is in compliance with the provisions of Electricity Rules, 2005 in terms of which the company, as a captive user, is required to own 26% proportionate ownership in one unit of MEL of 600 MW capacity, with RIL being the captive user of 500 MW generation capacity, RIL said in an exchange filing.

RIL and MEL have entered into a 20-year long term power purchase agreement for this purpose.

MEL, a company engaged in generation and supply of power, was incorporated on October 19, 2005.

The turnover of MEL, as per its audited standalone financial statement, for financial years 2022-23, 2021-22 and 2020-21 was Rs. 2,730.68 crore, Rs.1,393.59 crore and Rs. 692.03 crore, respectively, according to a statement.

Meanwhile, Adani Ports and Special Economic Zone Ltd (APSEZ) has announced its acquisition of the Gopalpur Port in Odisha from the Shapoorji Pallonji Group (SP Group) and Orissa Stevedores Ltd (OSL) at an enterprise value of Rs 3,080 crore. 

The acquisition is the latest in a string of port acquisitions by APSEZ over the past decade and adds to its dominance in non-major ports those not owned and operated by the Central government. 

For the debt-laden SP Group, the Gopalpur Port’s sale is in line with its strategy to pare debt by divesting non-core assets.