Adani, Tata, Sterlite and Power Grid submit bids to buy UP Transco
POWER & RENEWABLE ENERGY

Adani, Tata, Sterlite and Power Grid submit bids to buy UP Transco

Adani, Tata Power, Sterlite and state-owned Power Grid Corporation of India have presented binding bids to acquire South East UP Power Transmission Company.

It came after the power utility's majority shareholder Isolux Corsan filed for bankruptcy in Spain, leaving the local unit to fend for itself. Tata Power has proposed through Singapore-based Resurgent Power, in which it owns a 26% stake through a subsidiary.

An executive told the media that the tenders have not been opened till now and would be checked for legal compliance before negotiations are held with the bidders. The power transmission firm was put up for sale under the Insolvency and Bankruptcy Code (IBC) by its lenders in July 2020.

A spokesperson for Tata Power told the media that the firm continues to explore and evaluate various growth opportunities including in the transmission space. As shown earlier, the firm is looking at both greenfield and M&A transmission opportunities directly and through its stressed asset platform, Resurgent Power Ventures Pte Ltd.

A spokesperson for Sterlite told the media that the transmission firm is always looking at growth opportunities. But as a policy, they can neither confirm nor deny their involvement in any specific opportunity. As many as eight parties took interest in the preliminary bidding phase. Torrent Power, Megha Engineering, RECPDCL and a sovereign wealth fund had also presented expressions of interest in March. But ultimately, not all bid for the transmission utility.

Isolux Corsan had obtained a 35 year concession to construct a 1,600 km of the power transmission network in Uttar Pradesh in 2011. It had taken on loans worth Rs 4,500 crore from Indian lenders to finance the construction. The Madrid-based firm has constructed lines and substations within a 600 km stretch near Aligarh that are already operational. Of the remaining, nearly one third is complete.

Uttar Pradesh Power Corporation (UPPCL), the master electricity distribution firm in the state, pays South East UP Power Transmission Company for carrying power according to the concession agreement. The Union government has allocated electricity transmission lines among assets that it will monetise alongside airports, sports stadiums and ports in its budget announcements.

The private sector has been consistently demanding that more transmission lines must be auctioned to them under the tariff-based competitive bidding method. Private players have only a 5% stake in the power transmission sector yet. It differs sharply from the power production sector, where private players estimate about half the capacity.

Image Source


Also read: Govt to introduce 17 islanding schemes for power supply

Adani, Tata Power, Sterlite and state-owned Power Grid Corporation of India have presented binding bids to acquire South East UP Power Transmission Company. It came after the power utility's majority shareholder Isolux Corsan filed for bankruptcy in Spain, leaving the local unit to fend for itself. Tata Power has proposed through Singapore-based Resurgent Power, in which it owns a 26% stake through a subsidiary. An executive told the media that the tenders have not been opened till now and would be checked for legal compliance before negotiations are held with the bidders. The power transmission firm was put up for sale under the Insolvency and Bankruptcy Code (IBC) by its lenders in July 2020. A spokesperson for Tata Power told the media that the firm continues to explore and evaluate various growth opportunities including in the transmission space. As shown earlier, the firm is looking at both greenfield and M&A transmission opportunities directly and through its stressed asset platform, Resurgent Power Ventures Pte Ltd. A spokesperson for Sterlite told the media that the transmission firm is always looking at growth opportunities. But as a policy, they can neither confirm nor deny their involvement in any specific opportunity. As many as eight parties took interest in the preliminary bidding phase. Torrent Power, Megha Engineering, RECPDCL and a sovereign wealth fund had also presented expressions of interest in March. But ultimately, not all bid for the transmission utility. Isolux Corsan had obtained a 35 year concession to construct a 1,600 km of the power transmission network in Uttar Pradesh in 2011. It had taken on loans worth Rs 4,500 crore from Indian lenders to finance the construction. The Madrid-based firm has constructed lines and substations within a 600 km stretch near Aligarh that are already operational. Of the remaining, nearly one third is complete. Uttar Pradesh Power Corporation (UPPCL), the master electricity distribution firm in the state, pays South East UP Power Transmission Company for carrying power according to the concession agreement. The Union government has allocated electricity transmission lines among assets that it will monetise alongside airports, sports stadiums and ports in its budget announcements. The private sector has been consistently demanding that more transmission lines must be auctioned to them under the tariff-based competitive bidding method. Private players have only a 5% stake in the power transmission sector yet. It differs sharply from the power production sector, where private players estimate about half the capacity. Image Source Also read: Govt to introduce 17 islanding schemes for power supply

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