GMR sells 30% stake in GMR Energy for $300 mn to Tenaga Nasional

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Mumbai: GMR Infrastructure Ltd (GIL) on Monday said Malaysia’s largest electric utility Tenaga Nasional Bhd will invest $300 million in subsidiary GMR Energy Ltd and pick up 30% equity stake in a “select portfolio” of GMR Energy’s assets.

GMR Energy operates a power capacity of over 4,200 megawatts (MW) across coal, gas and renewable-based projects. It is also developing 2,300 MW of power generation capacities in India and Nepal. The funds would be used for the repayment of corporate debt, GMR Infrastructure said in a statement.

“This would lead to a reduction in GIL consolidated corporate debt and will result in a stronger balance sheet,” the statement said.

As of 30 September, GMR Infrastructure had total consolidated debt of Rs.43,439.60 crore.

GMR Energy expects to benefit from Tenaga Nasional’s experience in improving the performance of its operational assets and develop its pipeline of hydro and renewable energy assets.

Tenaga Nasional, one of the largest power companies in Southeast Asia, has a presence across the power generation, transmission and distribution segments. It has a total installed power capacity of 10,818 MW and control 50% of Malaysian grid’s generation capacity.

Over the past year, GMR has been working to strengthen its balance sheet.

In March, GMR Infrastructure agreed to sell a 51% equity stake in its 99km highway project in Karnataka to its joint venture partners, which earned it Rs.85 crore and removed Rs.1,077.94 crore in debt associated with the project off its books.

Earlier, in December, GMR raised $300 million by issuing 60-year foreign currency convertible bonds to Kuwait Investment Authority.