UAE-led group to buy two India power plants
TAQA holds a 51% stake in the consortium
A consortium led by UAE-based energy and water company TAQA has agreed to acquire two hydro-electric plants in India from Jaiprakash Power Ventures in a deal worth about $1.6 billion, making TAQA the largest private operator of hydro-electric plants in India.
The consortium agreed to purchase the Baspa Stage II and Karcham Wangtoo plants in the northern state of Himachal Pradesh.
TAQA, which holds a 51% stake in the consortium, will have control of operations and management of both facilities under the proposed deal. The remaining equity will be held by one of Canada's largest institutional investors (39%) and IDFC Alternatives' India Infrastructure Fund II (10%).
The equity invested by the consortium in the acquisition of the two hydro-electric plants will amount to approximately US $616mn, of which 51% is from TAQA. The consortium will also acquire the assets non-recourse project debt.
Frank Perez, TAQA's executive officer and head of Global Power and Water, said, "India's economic growth depends on having ample and reliable energy supply. TAQA is pleased to add these two high quality hydro power assets to our growing India business and to support India's economic growth." The two plants have a combined power generation capacity of 1,391MW. Both plants are located in Kinnaur district within two kilometres of each other and share support facilities. They use run-of-the-river technology to convert natural water flow to electricity, eliminating the need for a reservoir. The plants are 35 kilometres from the Sorang hydro-electric plant, in which TAQA acquired a stake last year.
Following the completion of the transaction, TAQA's gross operational power generation capacity in India will total 1,741MW, comprised of three hydro-electric facilities and one lignite power plant.