Adani Power has emerged as a successful bidder for Essar Power's 1,200 megawatt (MW) thermal power project in Singrauli, Madhya Pradesh undergoing bankruptcy proceedings.
"This is to inform that the Committee of Creditors (CoC) of Essar Power MP has approved the resolution plan submitted by Adani Power," said a disclosure by Adani Power.
The ICICI Bank-led CoC and resolution professional Ashish Chhawchharia will now seek approval of the insolvency tribunal for the Gautam Adani-controlled power firm’s plan to acquire the coal-based power project.
According to industry sources, Adani Power had in March this year made an offer of around Rs 2,600 crore to acquire the debt-ridden firm. Lenders had nudged Adani to sweeten this offer. The approved offer could not be ascertained independently.
Essar Power MP, promoted by Essar Power (74%) and ArcelorMittal Nippon Steel India (erstwhile Essar Steel India) (26%), was admitted in bankruptcy in September last year.
ICICI Bank had dragged the firm to the bankruptcy tribunal over a default of Rs 1,923 crore as on March 2020.
Of over Rs 20,200 crore claims made by creditors, a total of Rs 12,723 crore were admitted before the tribunal.
Besides ICICI Bank, other financial lenders include REC Ltd, Power Financial Corporation, Punjab National Bank and Edelweiss Asset Reconstruction Company (ARC).
Adani Power, part of the diversified Adani Group, is the largest private thermal power producer in India. The company has an installed thermal power capacity of 12,410 MW spread across six power plants in Gujarat, Maharashtra, Karnataka, Rajasthan and Chhattisgarh, apart from a 40 MW solar power plant in Gujarat, its website says.
It has more than 7,000 MW capacity power generation plants in the making.
Last year in December, Adani’s plan to acquire a 49% stake in Odisha Power Generation Corp from New York-listed AES Corp was dented after the deal fell through.
In August 2014, Adani Power bought Lanco Infratech’s 1,200 MW thermal plant in Udupi (Karnataka) at an enterprise value of a little over Rs 6,000 crore ($1 billion).