Ruias-owned Essar Energy on Tuesday announced the acquisition of the $2-billion thermal power project being set up by Navabharat Power Pvt Ltd in Orissa. This is Essar Energy's first-ever acquisition after the London Stock Exchange listing.
The acquisition will be carried out by Essar Energy owned subsidiary Essar Power Ltd (EPL) and will be funded from the over $1.9-billion IPO proceeds of Essar Energy.
"EPL has entered into binding agreements for the acquisition of a 100 per cent interest in Navabharat Power," the company said. "Navabharat Power is a 2,250- MW coal-fuelled project being set up in Orissa."
The acquisition is in line with Essar's plans announced at the time of IPO, said Naresh Nayyar, CEO, Essar Energy. "The development will keep us on track to develop over 11,000 MW of power capacity by 2014-end."
EPL will initially acquire 76 per cent of existing equity of Navbharat Power and the balance 24 per cent will be acquired upon completion of "certain project milestones".
T. Vikram Prasad and Harishchandra Prasad are the co-owners of Navbharat Power. "We are buying shares from both the owners in Navbharat Power Ltd," a senior Essar Power executive told HT.