Reliance Power's talks to acquire Jaiprakash Power Ventures' three hydro power projects have been called off following lack of clarity over capacity of the Karcham Wangtoo project.
The two firms, who had been in talks for two months, announced the decision to call of the talks in separate press statements but did not give detailed reasons for it.
Industry sources, however, said talks collapsed after Central Electricity Authority (CEA) issued show cause notice for alleged violation of techno-economic clearance conditions of the Karcham Wangtoo project, which had an approved capacity of 1,000 MW but actual capacity was built to 1,200 MW. Jaiprakash group (Japyee) was looking at selling the hydro projects to cut its nearly Rs 12,000 crore debt.
Jaiprakash Power Ventures ltd (JPVl) said in a statement, "For reasons not attributable to any regulatory uncertainties but due to difference of commercial aspects, discussion with ADAG has been called off."