Global private equity firm KKR is likely
to acquire a majority stake in Avantha Power and Infrastructure Ltd, a
Gautam Thapar-controlled independent power producer that’s close to
completing two thermal power plants of 660 mw each located in
Chhattisgarh and Madhya Pradesh.
The PE firm has entered into an
understanding to infuse $110 million (Rs 650 crore) in the company.
After the fresh round of funding, KKR’s economic interest in APIL will
be about 55%, said two persons familiar with the development. KKR had
already invested $125 million in Avantha Power in the last two rounds —
$50 million in 2010 and $75 million in 2011, giving it a 19% stake. “The
PE firm has already signed a preliminary term sheet with Avantha Power
and has started the due diligence process,” said one of the persons
cited above. “The fresh capital infusion is being done at a
significantly lower valuation than 2011.” Both parties declined
comment. “Avantha Group does not comment on market speculation,” said a
spokesperson. “KKR does not comment on market speculation,” said a
representative of the PE firm. One of the persons cited above said the
modality of the investment is yet to be finalised.
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