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CLP Holdings was founded in 1901 as China Light and Power Co. Ltd in Hong Kong.bloomberg
CLP Holdings was founded in 1901 as China Light and Power Co. Ltd in Hong Kong.bloomberg

Govt seeks response from CLP on ownership details

The Indian government has sought ownership details from Hong Kong-based CLP Group, before allowing its unit CLP India Pvt

The Indian government has sought ownership details from Hong Kong-based CLP Group, before allowing its unit CLP India Pvt. Ltd acquire an important power transmission link in the strategic North-East region, said two people aware of the development.

With power transmission projects being of a strategic nature, India has tightened clearances amid growing concern that power infrastructure could be targeted by forces looking to cripple its economy. The department for promotion of industry and internal trade (DPIIT) on 18 April notified changes in the foreign direct investment (FDI) policy by mandating government clearance for all FDI inflows from countries with which India shares a land border.

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CLP Group and Caisse de dépôt et placement du Québec (CDPQ)-owned CLP India, which has invested 14,500 crore so far in India, wants to buy the 254-circuit km Kohima-Mariani link that passes through Manipur, Nagaland and Assam. It has a power project portfolio of 3GW and wants to buy this project from Kalpataru Power Transmission Ltd (KPTL) and Techno Electric & Engineering Co.

According to CLP India, the family of chairman Sir Michael Kadoorie—which also owns the Peninsula Hotel Group—is the single largest shareholder group with a 35% stake. Institutional investors in Asia, Europe, UK and North America hold a 36% stake, with the balance 29% held by mostly Hong Kong-based retail investors.

A CDPQ spokesperson in an emailed response on 5 Januarysaid that the CLP Group will respond to Mint’s queries.

“As a policy, CLP India does not comment on market speculation. However, as previously disclosed by CLP Holdings, CLP India is seeking to acquire Kohima-Mariani Transmission Limited and the transaction is subject to agreed conditions precedent and approval from the Indian government in relation to the new foreign direct investment rules," CLP India said in an emailed statement to Mint.

“As of 31 December 2019, the single largest shareholder group of CLP Holdings is the family of chairman Sir Michael Kadoorie, which has a 35% stake," the company statement said.

Given the blurred ownership lines between state-run and privately held companies in China, and the Chinese government’s attempts to wrest tighter control over private enterprises, India has adopted a cautious approach.

“Since the rules were announced in April 2020, CLP India has worked closely with the government to seek clarifications on their impact. CLP India will continue to work together with the government to facilitate its investments in the country," the statement said.

Queries emailed to the spokespersons of ministries of power, and commerce and industry on Monday night remained unanswered till press time. A KPTL spokesperson also didn’t respond to queries mailed on Tuesday night.

CLP Holdings, founded in 1901 as China Light and Power Co. Ltd in Hong Kong, is among the earliest significant overseas entrants in India’s power generation sector. Hong Kong-listed CLP Holdings is the holding company for CLP Group, which has a 60% stake in CLP India.

The rest is held by CDPQ, one of Canada’s largest pension funds.

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