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RInfra signs business transfer agreement with Adani Transmission for WRSSS

Proceeds from the sale will be utilised to reduce its debt, the company claimed

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Reliance Infrastructure (RInfra) signed a business transfer agreement with Adani Transmission Ltd for sale of Western Region System Strengthening Scheme (WRSSS) Transmission Undertakings.

"WRSSS B & C Undertakings are being transferred to its two subsidiaries as part of process of sale of the businesses to Adani Transmission Limited. Earlier in December 2016, RInfra has entered into share purchase agreement with Adani Transmission Limited for sale of WRSSS valuing the businesses at Rs 1,000 crore," read a statement by RInfra.

The company claims that the proceeds from the sale will be utilised to reduce its debt. Through monetization of its various businesses and arbitration award, RInfra expects its standalone debt levels to reduce substantially to around Rs 10,000 crore by March 2018. RInfra's consolidated debt as on June 30, 2017, stood at Rs 29,000 crore.

"All key approvals (from Competition Commission of India, Central Electricity Regulatory Commission and lenders) have been obtained and transaction is expected to be closed shortly," added the statement.

The firm is also offloading other power assets including 74% stake in Parbati Koldam Transmission Company Ltd (PKTCL), located in Himachal Pradesh and Punjab, to Power Grid Corporation of India Ltd (PGCIL) to pare its debt.

On Friday, PTI had reported on RInfra disagreeing with credit rating firm India Ratings and Research's (Ind-Ra) decision to downgrade the company's rating over a delay in its proposed debt reduction plan.

The company in a filing to BSE had said that it "respectfully" disagrees with the views of India Ratings.

Ind-Ra "has revised its rating to IND A+(SO) (RWN) on the company's regulatory asset debt, IND A1 (RWN) on the company's short-term debt and commercial papers and IND A (RWN) on the company's long-term debt (bank facilities and non-convertible debentures," it said, adding that Ind-Ra is of view that there has been delay in the proposed debt reduction plan of the company.

Besides, in August 2016, RInfra had also sold its cement arm to Birla Corporation for Rs 4,800 crore as a part of the plans to sell its non-core businesses.

PARING DEBT

  • Proceeds from the sale will be utilised to reduce its debt, the company claimed
     
  • Standalone debt levels expected to reduce to around Rs 10,000 crore by March
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