Investors

Reliance Infrastructure sells all transmission assets to Adani

The assets, valued at $285m, are part of the company’s plan to monetise its non-core businesses, including roads and power, and focus on other growth sectors.

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Reliance Infrastructure is selling its entire power transmission portfolio to Adani Transmission, India’s largest private power transmission business, owned by Indian conglomerate Adani Group. 

The deal size has not been disclosed, but a Moody’s report said the assets were valued at around 19 billion rupees ($285 million; €256 million). Proceeds from the sale will be used to repay debt, Reliance said in a statement. 

The transaction will see Reliance, one of the largest infrastructure companies in India, divest two projects spanning over 3,000km under the Western Region System Strengthening Scheme, the first batch of privately owned transmission assets in India. The deal also includes the sale of a 74 percent stake in the Parbati Koldam Transmission Company, a joint venture with state-owned Power Grid Corporation of India owning some 460km of transmission lines. All three assets cross state borders. 

The transaction is expected to close within this year, subject to statutory and regulatory approvals and other conditions

Reliance said the deal is in line with its strategic plan of monetising non-core businesses and focus on growth sectors like defense, engineering, procurement and construction. “The monetisation of our cement business has been completed and the monetisation of roads and Mumbai power businesses are in an advanced stage,” the company said. Last November, Reliance sold a 49 percent stake in its Mumbai power business to Canada’s PSP Investments, retaining a 51 percent controlling stake in it. 

The Adani deal follows its recent acquisition of GMR Energy’s transmission assets in July. Upon the completion of the acquisition and counting ongoing projects under construction, Adani Transmission’s network will be boosted to around 10,800kms. 

Indian fund manager IDFC Alternatives said in May that it was looking to build an investment platform in the transmission sector, capitalising on India’s fast-growing power generation capacity, recent reforms and supportive policies.