Warburg Pincus acquires stake in Diligent Power

Warburg Pincus acquires stake in Diligent Power

Mumbai: Private equity Warburg Pincus has acquired a stake in Diligent Power Private Limited to enable Dainik Bhaskar group’s power vertical to accelerate its growth plans, the company said in a press release on Wednesday. Diligent Power, through its subsidiaries, is in the process of setting up power projects aggregating to 6,400 megawatts. These power projects include a 1,200 MW coal-based thermal power plant in the state of Chhattisgarh and a 1,320 MW super critical thermal power plant in the state of Madhya Pradesh.

In a statement R K Gupta, CEO, Diligent Power said, “Diligent Power has planned significant long term initiatives to capitalize on the huge potential presented by the sector."

Niten Malhan, managing director, Warburg Pincus India Private Limited said, “Warburg Pincus has been investing in the energy sector for over 30 years, and we see great opportunities here in ."

“Warburg has invested around $150 million (Rs 670 crore)," said a person involved in the development.

Avendus Capital Private Limited acted as the sole financial advisor to Diligent Power for this transaction. Amarchand & Mangaldas & Suresh A Shroff acted as legal advisors to Diligent Power, AZB & Partners acted as legal advisors to Warburg Pincus and KPMG conducted financial and accounting diligence for the transaction.

DB Power has signed accords with Chhattisgarh to build two thermal power plants of 1,200MW and 1,320MW capacity. State Bank of and IDBI Bank Ltd are the lenders for the Chhattisgarh projects. It has also signed a 2008 agreement with the Madhya Pradesh government to build a power plant in that state.

“The company has already given orders to Bhel ( Bharat Heavy Electricals Ltd) and Larsen an Toubro Ltd for the 1,200MW power plant in Chhattisgarh and is in the process of placing orders for the second power plant," Prason Pande,head-investor cell relation at the company said. DB Power is in the process of financial closure for its 1,320 MW thermal power plant in Madhya Pradesh, he added.

Private equity investors including 3i and New Silk Route have invested $75 million this year in Indian utility and energy companies including Ind-Barath Energy (Utkal) Ltd. and Kiran Energy Solar Power Pvt. Ltd, according to data from Dealogic (Holdings) Plc. Last year, PEs invested over $787 million in companies including Avantha Power and Infrastructure Ltd, GVK Energy Ltd and GMR Energy Ltd.