New Delhi, July 18 (IANS) Jindal Steel and Power Ltd (JSPL) shareholders on Monday approved the sale of its Raigarh 1,000 MW power plant in Chhattisgarh to JSW Energy, JSPL said in a release here.
It said the the company shareholders had overwhelmingly approved “the recently proposed divestment of the 1000 MW power unit of Jindal Power Ltd into a special purpose vehicle (SPV) for the purpose of transferring the same to JSW Energy Ltd., with an overarching aim of garnering value for our equity shareholders”.
“With the passing of these resolutions, we are confident of strengthening our balance sheets, while we work diligently to fully utilize our capacities in steel and power,” JSPL Chairman Naveen Jindal said in the statement.
The move will help reduce the debt burden of JSPL whose consolidated debt is around Rs 46,000 crore.
At the time of signing the deal in May, the Sajjan Jindal-led JSW Energy had said the acquisition is worth Rs 6,500 crore with certain pre-arranged conditions.
It said in a statement that the enterprise value of the deal is Rs 4,000 crore plus net current assets and “which will be increased to Rs 6,500 crore plus net current assets, if certain pre-arranged conditions regarding fuel security and power off take are satisfied”.
JSPL said: “As part of monetization plans already advised, JSPL has been looking to generate cash flows from select divestments to be in much stronger position to meet all its liabilities and emerge as financially strong and sustainable company in 2016-17.”