Singapore’s sovereign wealth fund Temasek, IDFC Alternatives and Ascent Capital are looking to part exit in the initial public offer of GMR Energy, the power business arm of GMR Infrastructure. GMR Energy has filed its documents for the public float in which it seeks to raise Rs 1,450 crore ($242 million), through a fresh issue of shares besides an offer for sale by the private equity investors.
Half of the money raised through fresh issue will be used for funding equity contribution in two power projects, including 1,050 MW (Phase I) Kamalanga Power Plant in Orissa and 1,370 MW Chhattisgarh Power Project. It would use another Rs 450 crore for debt repayment the rest for other corporate purposes.
Incorporated in October 1996, GMR Energy has gross operational capacity of 2,498 MW and an additional gross capacity of 2,318 MW under construction. Of the 2,318 MW under construction, it expects two units of 685 MW capacity each to begin operations by the end of fiscal year 2015. In addition, it has a pipeline of power projects with an aggregate gross capacity of 3,695 MW that are currently under various stages of development.
It has interests in power generation, transmission and trading besides coal mining assets, including a stake in a listed Indonesian firm.
GMR Energy’s total income declined marginally to Rs 2,257 crore for FY13 against Rs 2,302 crore for the year ended March 31, 2012. However, this was propped up by income from mining activities as income from sale of electricity was down almost a third to Rs 1,372 crore against Rs 2,040 crore in the previous year. In the same period its net loss rocketed to Rs 892 crore from just Rs 4.4 crore in FY12.
For the six months period ended September 30, 2013, the company recorded total income of Rs 1,404 crore with net loss of Rs 849 crore.
It had long-term debt of Rs 17,712 crore and total debt of Rs 23,430 crore as on September 30, 2013.
Meanwhile, the proposed part exit of the PE firms comes even as they swapped bulk of their investment in the firm with a stake in the listed parent GMR Infrastructure.
These investors had put in Rs 1,395 crore in GMR Energy through Compulsorily Convertible Preference Shares (CCPS) in 2010. They picked CCPS worth Rs 1,136.6 crore in GMR Infrastructure, which would give them around 12.2 per cent of the diluted equity base of the listed firm on conversion of the securities into shares.
Their remaining investment worth Rs 254 crore in GMR Energy will continue as it is.
Bank of America Merrill Lynch, ICICI Securities, Kotak Mahindra Capital, Macquarie, Nomura, StanChart and Yes Bank are the book running lead managers to the issue.
Temasek, IDFC Alternatives among others to swap investment worth $183M in GMR Energy with stake in parent GMR Infrastructure
(Edited by Joby Puthuparampil Johnson)
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