Adani Transmission shares up 10% as company is in talks to buy Reliance Infra's Mumbai power business
Reliance Infra intends to utilise the proceeds of the proposed transaction entirely to reduce its debt
New Delhi: Reliance Infrastructure has entered into a period of exclusivity with Adani Transmission for proposed sale of its integrated business of generation, transmission and distribution of power for Mumbai. Shares of Adani Transmission rose 10 percent or Rs 17.55 to Rs 193.25 on the BSE after the announcement while Reliance Infrastructure share price up 0.37 percent to Rs 478.85.
In a regulatory filing on Tuesday, Reliance Infrastructure said, "It has entered into a period of exclusivity until January 15, 2018, in relation to discussions for the proposed sale of its integrated business of generation, transmission and distribution of power for Mumbai city to Adani Transmission."
The proposed transaction is subject to confirmatory diligence, definitive documentation and customary approvals.
"Accordingly, there can be no certainty that a transaction will result. Further announcements will be made at an appropriate stage," Reliance Infra added.
The Anil Ambani-led Reliance Infra intends to utilise the proceeds of the proposed transaction entirely to reduce its debt and further strengthen its financial position to tap mega growth opportunities in defence and EPC (engineering, procurement, construction) for the infrastructure sector.
According to Adani Transmission, the proposed transaction will strengthen its footprint in the power transmission sector and also mark its foray into the distribution space.
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