Adani Transmission Ltd has signed a pact with KEC International Ltd to acquire a transmission project, as the billionare Gautam Adani-led company continues to snap up power assets.
The companies said in stock exchange disclosures Adani Transmission will buy KEC Bikaner Sikar Transmission Pvt. Ltd for an enterprise value of Rs 227.5 crore ($31 million) in cash.
KEC Bikaner Sikar Transmission has an operational transmission line of 344 circuit km from Bikaner to Sikar in Rajasthan. It was commissioned in December 2017 and reported revenue of Rs 53.25 crore in the year through March 2018.
The acquisition is in sync with the company’s strategy to enhance the value for its stakeholders through organic as well as inorganic opportunities, Adani Transmission said.
The transaction is likely to be completed in two to three months subject to all necessary regulatory approvals.
Vimal Kejriwal, managing director and chief executive at KEC International, said the sale is in line with its strategy of being an asset-light company and focus on its core business of providing engineering, procurement and construction services to the infrastructure sector.
Adani Transmission is part of Adani Group. It has a total power transmission network, along with this acquisition, of around 12,923 circuit km. This comprises 10,357 circuit km under operation and 2,566 circuit km under various stages of construction.
In August, Adani Transmission had completed the acquisition of Reliance Infrastructure Ltd’s Mumbai power business, which includes generation, transmission and distribution of power for the city. The deal was announced in December 2017.
KEC International, part of Harsh Goenka-led RPG Group, operates in power transmission and distribution, railways, cables and civil construction businesses.
The company’s consolidated revenue was Rs 10,096 crore for the year through March 2018, up from Rs 8,755 crore in the previous year.