Greenko makes $2.1-billion bid for Reliance Infrastructure’s Mumbai Power business

MUMBAI: Greenko, backed by Singapore’s GIC and Abu Dhabi Investment Authority, has sought to acquire Anil Ambani-led Reliance Infrastructure’s flagship Mumbai electricity business for an enterprise value of Rs 13,000-14,000 crore ($2.15 billion), said people aware of the matter.
Torrent and Adani Group as well as Prem Watsa’s Fairfax Group are believed to be circling the same target, long considered an infrastructure crown jewel.
The offer is higher than the Rs 12,223.78 crore market cap of Reliance Infrastructure (R-Infra). India’s largest renewables company Greenko submitted a “timebound, non-binding offer” recently and is awaiting a response from Reliance to enter into exclusive negotiations.
Meanwhile, Gujarat-based Torrent Power and Adani Group have also begun evaluating the target, backed by commitments from lenders such as State Bank of India and Standard Chartered Bank. Feelers have also gone out to Fairfax, and even to the Tata Group, executives said.
Greenko’s offer will lapse this week unless both parties agree to exclusivity. But with multiple potential candidates, the situation could soon turn more competitive.
“The sellers would try to get the maximum value through a competitive auction-like scenario, but that may also see pullouts by some of the strategic players,” said one of the senior executives mentioned above.
The Mumbai business caters to 3 million customers, making it the country’s largest private sector integrated power utility, entailing 1800 mw of distribution along with generation facilities, besides an underground network of over 1,000 km. The distribution franchise is nine decades old with the licence valid till August 2036. Spokespersons for Reliance Infrastructure, Greenko and Fairfax declined comment on what they said was speculation.
There was no response to emails, calls and text messages to Torrent Power vice-chairman Samir Mehta on Saturday. A Tata Power spokesperson said the company was not aware of any overture while Adanis did not respond to ET’s detailed questionnaire. ET was the first to report on August 29 about Greenko’s talks with Ambani.