New York-based private equity group Blackstone will invest $300 million in Indian power developer Moser Baer, a source close to the company told Infrastructure Investor.
The investment is seen as a step by Moser Baer to partly fund its expansion plans. Further details of the deal will be announced later this week. The deal comes a week after Blackstone acquired Dynegy, the American independent power producer for $4.7 billion.
Meanwhile, the group is expected to increase its investments in India to up to $3 billion over the next five years, according to news reports. The focus of these investments will be infrastructure and the consumer markets.
Presently, half of Blackstone’s $1 billion investment in India is focused on the infrastructure sector. Earlier in July, the group acquired small stakes in Monnet Power, a subsidiary of listed firm Monnet Ispat and Energy, for $59 million.
Reports suggest that Moser Baer needs a total of INR30 billion (€501.1 million; $643.3 million) to build power plants generating 5,000 megawatts by 2016. More than three-fourths of this amount will be met through debt, with the remainder to come from the company founders and private equity.
Moser Baer has currently raised a total of INR4.7 billion in debt and INR 2 billion in equity, including the funds from Blackstone, according to local media reports. The company has also achieved financial close on 1220 megawatts’ worth of power projects.