Reliance Industries Invests in Adani Power's Mahan Energen

By siliconindia  |  Thursday, 28 March 2024, 03:43:21 PM IST

Reliance Industries Invests in Adani Power's Mahan Energen

Reliance Industries Limited (RIL) has announced its agreement with Mahan Energen Limited (MEL), a subsidiary of Adani Power Limited (APL), for a significant investment. As part of this arrangement, RIL will subscribe to 5 crore equity shares of MEL, each with a face value of Rs 10, at par value.

This investment aligns with the provisions outlined in the Electricity Rules, 2005, wherein RIL, as a captive user, is mandated to possess a 26% ownership stake in a specific unit of MEL, boasting a 600 MW capacity. Notably, RIL will be utilizing 500 MW of the generated power capacity.

In tandem with this investment, RIL and MEL have cemented a 20-year long-term power purchase agreement, solidifying their commitment to this collaboration.

MEL, a seasoned player in the power generation and supply sector, was established on October 19, 2005. Its audited standalone financial statements for the fiscal years ending 2020-21, 2021-22, and 2022-23 depict a steady growth trajectory, with turnovers of Rs 692.03 crore, Rs 1,393.59 crore, and Rs 2,730.68 crore, respectively.
Crucially, RIL has clarified that this investment does not constitute a related party transaction, and neither the company's promoters nor its affiliated entities have any vested interest in this venture.
The completion of this investment is contingent upon the fulfillment of customary conditions precedent and the receipt of requisite approvals by MEL. RIL anticipates the conclusion of this transaction within two weeks from the satisfaction of these conditions and the receipt of necessary approvals by MEL.

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