This comes in the backdrop of the public sector unit in advanced talks with investors for its first tranche of projects through an infrastructure investment trust (InvIT) route. Post the first tranche, a ₹10,000 crore second tranche for the InvIT is also in the works as reported by Mint earlier.
“Power Grid Corporation of India Limited (POWERGRID) has signed a Share Purchase Agreement with Jaiprakash Power Ventures Limited (JPVL) to acquire 74% stake in Jaypee Powergrid Limited-JV (JPL) in which POWERGRID holds 26% equity," PGCIL said in a statement on Friday.
“JPL will become a wholly owned subsidiary of POWERGRID following this acquisition," the statement added.
PGCIL has already filed the draft offer document for its first tranche for projects held in a special purpose vehicle (SPVs) through an InvIT with Securities and Exchange Board of India (SEBI) for monetizing five of its tariff-based competitive bidding B) assets valued at about ₹7,000 crore.
InvITs are trusts that manage income-generating infrastructure assets, typically offering investors a regular yield and a liquid method of investing in infrastructure projects. The InvIT route was proposed by the government as an alternative fundraising route for state-run companies to manage their funding requirements without having to depend on government support.
PGCIL is among the first state-owned companies to offer an InvIT as part of the government’s brownfield asset monetization strategy, with the InvIT expected to attract domestic and global investors including sovereign wealth funds.