The board of Adani Power will meet on Monday to consider hiving off its flagship Mundra power station to a new subsidiary in which the Gujarat government entity may take a majority stake.
“A meeting of the board of directors of the company is scheduled to be held on June 6, 2017 to consider and evaluate, among others, the Slump Sale of its Mundra power generating business undertaking to its subsidiary company, name Adani Power (Mundra) ltd,” the company said in a regulatory filing.
Industry sources said Gujarat Urja Vikas Nigam ltd (GUVNl) -- the Gujarat Government entity -- which buys bulk of the 4,260 MW electricity generated at Mundra - may take 51 per cent stake in the new subsidiary.
While emails sent to company for comments remained unanswered, GUVNl officials could not be immediately reached for for the same.
last month, Adani Power had discontinued 1,250 MW power supply to GUVNl in a phased manner, mainly due to the unviability of running its power plant at Mundra on imported coal.
Of 2,000 MW power provided by Adani Power to GUVNl under different power purchase agreement’s (PPAs), 1,250 MW supply wasdiscontinued.
Sources said the company had told the state government that operating Mundra power plant at the tariff specified in the PPA using imported coal (from Indonesia) was unviable after the Supreme Court disallowed raising power tariffs to compensate for rise in price of coal from Indonesia.
Adani Power had entered into a long-term PPA with GUVNl in 2007 for supply of 1,000 MW of electricity at a levelised tariff of Rs2.35 per unit for a period of 25 years.