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Even as its in the race for Singapore's Senoko Power, Tata Power has picked up 10% stake in Australian geothermal energy company. Tata has picked up the stake in Geodynamics Ltd for $37.8 million. Tata has acquired the stake at a price of $1.25 per share and will also get a director's seat in the company.

This investment is expected to strengthen presence in renewable energy segment and get foothold in the growing renewable energy market in Australia. Besides acquiring a foothold in the renewable energy market in Australia, both the companies have also agreed to review geothermal prospects outside Australia leveraging their expertise. 

Tata Power is also in the race for Temasek-controlled Senoko Power, which is Singapore's largest-power utility company. The valuation expected for the deal are $3 billion. Tata Power has already arranged a debt of $1 billion for this acquisition from SBI. Japan's Marubeni & Mitsubishi, Malaysia's YTL Power, France's GDF Suez and the OneEnergy - CLP Holdings combine are the other bidders. 

Geodynamics has market capitalization in excess of $291 million (August, 2008). It has geothermal exploration interests in three Australian states including the license for exploring 2,000 sq. km of area in the Cooper Basin. Geodynamics tenements in the Cooper Basin contain the hottest granites on earth and are estimated to provide a thermal resource equivalent of 50 billion barrels of oil.

 

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