Citing regulatory uncertainties, Anil Ambani-led Reliance Power on Wednesday called off a deal with Jaiprakash Power Ventures Ltd (JPVL) to buy the latter’s entire hydel power portfolio. Considered as the largest in India’s infrastructure sector, the deal was valued at close to Rs. 12,000 crore.
The projects have an operating capacity of 1,791 mega watt — the largest hydro power capacity outside government control.
Lack of clarity over Jayprakash’s 1,000-MW Karcham Wangtoo (KW) project is said to have hit the deal.
“Due to prevailing regulatory uncertainties and tariff issues, which impact valuations, Reliance Power and JPVL have terminated discussions regarding Reliance Power’s acquisition of JPVL’s hydro portfolio of three projects,” a spokesperson of Reliance Power said.
“For reasons not attributable to any regulatory uncertainties but due to difference of commercial aspects, discussion with ADAG (Anil Dhirubhai Ambani Group) has been called off,” JPVL said in a statement.
{{/usCountry}}“For reasons not attributable to any regulatory uncertainties but due to difference of commercial aspects, discussion with ADAG (Anil Dhirubhai Ambani Group) has been called off,” JPVL said in a statement.
{{/usCountry}}“The company was determined to take steps in the larger interest of shareholders in the prevailing economic scenario,” said Manoj Gaur, chairman, Jaypee Group.
The move is seen as a setback for Jaypee Power and Jaypee Associates, which were looking to reduce their Rs. 60,000-crore debt by Rs. 12,000 crore through this deal.