Adani Sells 25.10% Stake in AEML to Qatar Investment Authority

State energy transition study

Adani Transmission has announced that the Qatar Investment Authority has completed the acquisition of a 25.10 percent stake in AEML

Adani Transmission Limited (ATL) has announced that Qatar Investment Authority (QIA) has completed the acquisition of a 25.10 percent stake in Adani Electricity Mumbai Limited (AEML) from ATL along with an investment in shareholders subordinated debt in AEML (Transaction) on February 10, 2020.

The total QIA investment in AEML is approximately Rs 3,220 Crore (approximately USD 452 million), which includes equity consideration of approximately Rs 1,210 Crore (approximately USD 170 million) and shareholder subordinated debt of USD 282 million (approximately Rs 2,010 Crore).

AEML is the licensee for an integrated power distribution, transmission and generation business that currently serves more than 3 million consumers across a license area of approximately 400 square kilometers in the city of Mumbai. The firms’ market share of Mumbai is approximately 87 percent by license area, 67 percent by consumers served and 55 percent by electricity supplied.

The definitive agreements for the Transaction were signed on December 11, 2019, and all the requisite approvals were received subsequently. AEML has recently completed an investment grade, USD 1 billion bond issuance, the first by a private integrated utility from India. The issue generated significant interest from international investors and was oversubscribed by 5.9x.

The entire equity proceeds of 25.1 percent stake sale in AEML has been used by ATL towards the return of the Perpetual to the tune of Rs 1,209.62 Crore in favour of contributory promoter entity. Perpetual was infused by the Promoter entity to acquire AEML. Post return of Rs 1,209.62 Crore, Promoter Perpetual outstanding has got reduced to Rs 2,544.38 Crore.

In December, ATL had received the Letter of Intent (LOI) from Maharashtra State Electricity Transmission Company Limited (MSETCL) to build, own, operate and maintain a transmission project in the state of Maharashtra for a period of 35 years. This will be the first-ever 400 kV substation facility in the city of Mumbai.

More recently, we had reported that Rosepetal Solar Energy (RSEPL), a wholly-owned subsidiary of Adani Green Energy Limited (AGEL) has been awarded 700 MW solar-wind hybrid capacity by the Adani Electricity Mumbai Limited (AEML) after the state commission had approved the latter’s petition for the award of the capacity under a hybrid wind-solar tender.