Having successfully completed the $542 million acquisition of Globeleq America’s power assets, DS Constructions Ltd is now eyeing a share in a European company.
MUMBAI: Having successfully completed the $542 million acquisition of Globeleq America’s power assets in June this year, Delhi-based D S Constructions Ltd is now eyeing a share in a European company.
It is expected to take up to 22% stake in Athens-based construction company Aegek SA for around $43.4 million (Rs 170 crore).
A Bloomberg report said Aegek SA had informed Athens Stock Exchange that D S Constructions Ltd would be investing €30 million ($43.4 million) in buying the shares of the company. It may further increase the stake to 33% in the next three years, said Aegek in the statement to the stock exchange. However, officials at D S Constructions refused to comment on the development.
After the acquisition of Globeleq America in 2007, D S Constructions was looking at more takeovers overseas to increase its presence in the power and construction sector. The recent development aptly complements the company’s plans of inorganic expansion strategy.
Rafi Qadar Khan, general manager, D S Constructions, said, “We want to augment our capacity to 10,000 MW in the next 10 to 12 years in the power sector. We also have plans to inorganically expand our construction business and power assets by overseas acquisitions.”
The company has planned an investment of Rs 50,000 crore in the power sector over this period, he said.
“In India, we would only rely on greenfield expansions and would go for more acquisitions and joint ventures overseas for our inorganic growth,” said Khan.
He, however, did not mention the countries where it was looking at acquisitions.
The acquisition of Globeleq America was through a 50:50 joint venture with Israel Corporation. With the acquisition, the company added some 2,180 MW to its power portfolio, taking it to 3,400 MW worldwide. The acquired assets included natural gas and hydro power plants spread across six countries in South America.
The company forayed into the power sector in 2006 with the 1,000 MW Naying Hydroelectric Project in Arunachal Pradesh. It emerged as an independent power producer the same year by bagging the 260 MW Kutehr Hydro Project in Himachal Pradesh. The Naying project on Siyom river in West Siang district is worth Rs 5,000 crore, while the Kutehr project is worth Rs 1,058 crore.
Khan said the process of preparing detailed project reports and obtaining clearances for the Kutehr project has started and the implementation is expected to start by the last quarter of 2008. To a question, Khan said the company was not actively pursuing the government’s 4,000 MW ultra mega power project scheme.
Sources said the company has bid for the third UMPP, coming up at Krishnapatnam in Andhra Pradesh, in JV with Israel Corporation.
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