IDFC Project Equity invests Rs3.5bn in Indian power company

IDFC Project Equity has injected INR3.5 billion ($70 million; €51 million) into power plant operator Essar Power, part funding the operator’s expansion plans from a dedicated India Infra Fund that it manages.

Essar Power operates three power plants, with another four under construction. When completed over the next three years, the company’s generating capacity will increase more than fivefold to about 6,000 megawatts.

“What we particularly liked about this investment is our partner’s credible and measured project development and execution plans,” said MK Sinha, IDFC Project Equity’s president and chief executive.

This is India Infrastructure Fund’s first investment. It held a first close on $875 million in June 2008 and is targeting $5 billion in equity and debt for infrastructure development in India, said a spokesman.

A joint venture between Citi, the Indian government and IDFC, the fund invests broadly in energy, transport infrastructure and telecoms infrastructure.