Gautam Adani-led Adani Group is preparing to buy a plant of Reliance Power. Adani Group can spend Rs 2,400 to 3000 crore on this deal. Adani Power is currently in talks with CFM Asset Reconstruction Company to buy this closed plant.
Butibori Thermal Power Project is of 600 MW capacity
According to a Mint report, Adani Power wants to buy the 600 MW Butibori Thermal Power Project located in Nagpur. Its control was earlier with Anil Ambani’s Reliance Power. Adani Group is ready to pay Rs 4 to 5 crore per megawatt for this plant. There are two power plant units in this project. Earlier their valuation was Rs 6000 crore. But, after the production stopped, the valuation has been halved. This plant fits into the strategy of Adani Group.
Sajjan Jindal’s JSW Energy had also shown interest
The Butibori thermal power project is operated by Reliance Power’s subsidiary Vidarbha Industries Power. This project was also closed after Reliance Power got into financial crisis. Earlier, Sajjan Jindal’s company JSW Energy had also shown interest in buying it. But, they backed out after seeing the high valuation and operational problems.
Creditors filed bankruptcy petition against the company
Earlier, Reliance Power used this Butibori plant to supply electricity in Mumbai. But later Adani Electricity took away the distribution business of Mumbai from them. In December 2019, the power purchase agreement between Vidarbha Industries and Adani also ended. After this, the Butibori project got stuck in financial crisis. The creditors have filed a bankruptcy petition against the company. But, the bankruptcy process has not been started yet. Adani Group will buy it and connect it to its Tiroda power plant located near Nagpur.
