3i fund takes 10 pc in Adani Power
London-based global private equity (PE) fund 3i Group said on Thursday that it has picked up a lower than 10 per cent stake in Adani Power for Rs 900 crore ($227 million). Company sources said the private placement had been done at a valuation of around Rs 10,000 crore or $2.5 billion.
While refusing to divulge the details of the deal, Anil Ahuja, managing director and co-head of 3i Asia, said that the fund has acquired a minority stake in the company for $227 million, adding that the investment was part of $1-billion India Infrastructure Fund that 3i is in the process of raising from global investors. The funds would be invested within next two to three years.
"We have launched the fund and are committed to investing $500 million from our own balance sheet. The remaining money will be from third party investments. The investment in Adani Power is the first investment from the India Infrastructure Fund," said Ahuja.
"India is witnessing a phenomenal growth in the power sector, specifically in power generation," said Ahuja. Power generation in India is expanding on the back of government spending to sustain economic growth, policy reform, a focus on rural electrification and increasing power consumption, he added.
Adani Power, a subsidiary of Adani Enterprise, is setting up 2640 megawatt imported coal-based power plant in Gujarat. The project, launched in June 2006, is expected to become operational by 2009 and achieve full capacity by the close of 2010.