Mumbai, Sep 3 (IANS) Reliance Infrastructure’s (RInfra) ratings have improved with the completion of transaction for sale of its Mumbai power business, the proceeds of which have been used to pay off debt liabilities, the company announced on Monday.
An RInfra release here said that credit rating agency Brickwork Ratings (BWR) has withdrawn its ‘D’ ratings for the company’s non-convertible debentures (NCD), totalling Rs 468.70 crore.
“BWR has withdrawn the rating of D for the NCDs amounting to Rs 418.70 crore and BWR C for the NCDs amounting to Rs 50 crore of Reliance Infrastructure as the company has repaid the NCDs from the funds received from the sale of Integrated Mumbai Distribution Business to Adani Transmission,” it said.
The entire proceeds of the sale have been used to pay debt, including these NCDs, it added.
RInfra Chairman Anil Ambani had recently said he expects top-end ratings for the company with the closure of the deal for the Mumbai power distribution business and the drastic fall in debt liabilities.
RInfra last week said that it has completed the Rs 18,800-crore sale of its Mumbai integrated distribution business to Adani Transmission (ATL), which will help RInfra reduce its debt by nearly two-thirds to Rs 7,500 crore.
At a media briefing here, following a board meeting to approve the transfer of the Mumbai power business, RInfra Chairman Anil Ambani announced the closure of the deal, which was signed in December 2017.
“For Reliance Infrastructure, this is truly a transformative transaction. The company’s gross debt will be reduced from about Rs 22,000 crore to only Rs 7,500 crore, representing a steep debt reduction of 65 per cent in a single transaction,” he said.
RInfra and ATL had signed the Definitive Binding Agreement for 100 per cent stake sale of the integrated business of generation, transmission and distribution for Mumbai in December 2017.
Reliance Energy, operating the Mumbai power business, supplies to nearly three million residential, industrial and commercial consumers in the city suburbs, covering an area of 400 sq km. It caters to a peak demand of over 1,800 MW, with annual revenues of Rs 7,500 crore with stable cash flows, the company had said.
On the company’s engineering and construction business, Ambani said that some of the showpiece projects in Rinfra’s order book include the Rs 7,000-crore Versova-Bandra Sealink, Mumbai Metro Line 4, Kudankulam Nuclear Power Project in Tamil Nadu and the integrated LNG Terminal and power project in Bangladesh.