GVK Energy Ltd, a subsidiary of GVK Power & Infrastructure Limited has raised another Rs.698 Cr from Actis and Government of Singapore Investment Corporation (GIC), after raising Rs.800 Cr from 3i last month. With this deal, the total PE investment in GVK Energy has now gone up to Rs.1,498 Cr for an overall dilution of 24.97% stake.
Both PE firms will invest Rs 349 crore each, of which Rs.218 Cr each will be invested as the first tranche of the deal. GVK Energy which currently has a power generation capacity of 901 Mw plans to use the proceeds to expand capacity up to 4,500 MW by 2013-14.
GVK Group consolidated its power business under GVK Energy Ltd earlier this year, transferring its investment in GVK Industries Ltd, GVK Gautami Power Ltd, GVK Power (Goindwal Sahib) Ltd and Alaknanda Hydro Power Company Ltd.
GVK Energy is expanding the capacity of its 264-Mw, gas-based, plant in Jegurupadu, Andhra Pradesh, to 1,064 Mw. It is also expanding yet another gas-fired power plant in Andhra, Gautami Power, from 464 Mw to 1,264 Mw. GVK is also developing a 600-Mw, coal-based power plant in Goindwal Sahib, Punjab.
Some of the deals in the power sector this year include, $425 Million in Asian Genco by a consortium led by Morgan Stanley Infrastructure Partners and $305 Million investment in GMR Energy by Temasek, IDFC Private Equity, Ascent Capital and others. Blackstone invested $300 million in Moser Baer Projects, which plans to commission 5,000 MW capacity by 2016.
GVK Power & Infrastructure Ltd is also planning to raise $400 Million by selling up to 26% stake in its airport subsidiary-GVK Airport Developers Private Limited. Actis is an emerging markets private equity investor with $4.7 billion (Rs. 21,338 crore) under management. GIC is a global investment management company established in 1981 to manage Singapore’s foreign reserves. GVK is present in sectors including energy, airports, roads and urban infrastructure.
As on date, GVK has invested more than Rs. 10,786.02 crore in infrastructure projects and has on-hand projects worth more than Rs. 25,000 crore.
In the electricity sector alone, India is facing a peaking shortage of nearly 12% and an energy shortage of 9-10%. Sushilkumar Shinde, Union minister for power, in October said India was targeting a capacity addition of 62,000MW in the 12th Five Year Plan (2012 -2017). In 2007-2012, the funding requirement in the Indian power sector has been estimated at $230 billion.
Source: Invest In India