Adani Power-Led Consortium Secures Letter of Intent for Coastal Energen Acquisition
Adani Power, at the helm of a consortium, has received a letter of intent (LoI) for acquiring Coastal Energen, which is currently in the midst of corporate insolvency resolution proceedings.
In a regulatory disclosure made on Sunday, Adani Power underscored the receipt of the LoI from the resolution professional the previous Saturday, following the approval of the resolution proposal by Coastal Energen's committee of creditors.
A consortium led by the State Bank of India had extended loans to Coastal Energen for the establishment of a 1,200-megawatt thermal power project in Tamil Nadu.
Due to delays and cost escalations, the project's expenses escalated to Rs 7,870 crore, comprising a debt component of Rs 6,296 crore and equity amounting to Rs 1,574 crore. The initial project cost stood at Rs 4,297 crore, with a debt of Rs 3,323 crore.
The promotion of Coastal Energen is attributed to the Coal and Oil Group through Mutiara Energy Holdings in Mauritius and Precious Energy Holdings, an energy conglomerate based in Dubai.
Coastal Energen currently manages two 600 MW units in Tamil Nadu and holds an active power purchase agreement with Tamil Nadu Generation and Distribution Corp (Tangedco) valid until September 2028 for one of its units.
In October, Mutiara Energy Holdings proposed a comprehensive settlement of Rs 5,847 crore, encompassing a 15 per cent equity stake, amidst reports indicating Adani Power emerging as the successful bidder for the beleaguered power company.
Closing at Rs 511.80 on the Bombay Stock Exchange (BSE), Adani Power's shares experienced a marginal decline of 0.05 per cent on Friday.
