RIL buys 26% stake in Adani project

MUKESH AMBANI'S Reliance Industries (RIL) has bought a 26 per cent stake in a Madhya Pradesh power project of Gautam Adani, and signed a pact to use the plant’s 500 MW of electricity for captive use. This is the first business collaboration between the two billionaires.

Mahan Energen Ltd (MEL), a wholly owned subsidiary of Adani Power Ltd, has agreed to allot five crore equity shares of face value of Rs 10 each of MEL to RIL at par.

The proposed investment by RIL is in compliance with the provisions of Electricity Rules, 2005 in terms of which the company, as a captive user, is required to own 26 per cent proportionate ownership in one unit of MEL of 600 MW capacity, with RIL being the captive user of 500 MW generation capacity, RIL said in an exchange filing.

RIL and MEL have entered into a 20-year long term power purchase agreement for this purpose. MEL, a company engaged in generation and supply of power, was incorporated on October 19, 2005.

The turnover of MEL, as per its audited standalone financial statement, for financial years 2022-23, 2021-22 and 2020-21 was Rs. 2,730.68 crore, Rs.1,393.59 crore and Rs. 692.03 crore, respectively, according to a statement.

“The investment is not a related party transaction and none of the company’s promoters, promoter group or group companies have any interest in the said investment. The investment is subject to customary conditions precedent including receipt of requisite approvals by MEL and is expected to be completed within 2 weeks of receipt of completion of conditions precedent and receipt of such approvals by MEL,” RIL said.

With this, promoters have infused `11,661 crore in .