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The Indian energy landscape is witnessing a significant shift with Adani Power entering into discussions to acquire Reliance Power's 600-MW Butibori thermal power project in Nagpur. This potential deal, valued at an estimated Rs 2,000-3,000 crore, marks another strategic move by Gautam Adani's conglomerate, further solidifying its presence in the power sector. The acquisition, if finalized, would translate to a price of Rs 4-5 crore per megawatt, reflecting the ongoing consolidation and competition within the Indian power industry.
The Butibori thermal power plant, once owned by bankrupt Reliance Power, is currently under the management of Vidarbha Industries Power, a subsidiary of the former. Adani Power is engaged in negotiations with CFM Asset Reconstruction Company, the sole lender to the power project. The project, comprising two plants, was previously valued at around Rs 6,000 crore. However, the plant's closure has impacted its valuation, leading to the current proposed acquisition price.
This acquisition follows the recent slump sale of Reliance Power's Vashpet, Maharashtra, wind power project to JSW Renewable Energy. In April 2023, Reliance Power completed the transaction, receiving Rs 132.39 crore as consideration. Earlier in March, two Reliance Power subsidiaries settled debt worth Rs 1,023 crore with Authum Investment's arm Reliance Commercial Finance. These transactions highlight Reliance Power's efforts to streamline its portfolio and manage its debt obligations, a strategy that likely fueled the decision to divest the Butibori thermal power project. The acquisition by Adani Power, if successful, would allow the conglomerate to expand its power generation capacity and further strengthen its position in the Indian energy market.
Source: Adani Power in talks to buy Reliance Power's 600-MW thermal plant in Nagpur