In a bid to further strengthen its position in the energy sector, Mukesh Ambani-led Reliance Industries has picked up 26% stake in Adani Power owned subsidiary.
Mahan Energen, a wholly owned subsidiary of Adani Power has inked a 20-year long-term Power Purchase Agreement (PPA) for 500 MW with Reliance Industries (RIL), under the Captive User policy as defined under the Electricity Rules, 2005.
In order to avail the benefit of this policy, RIL has to hold a 26% ownership stake in the Captive Unit in proportion to the total capacity of the power plant. It will accordingly invest in 5000 crore equity shares of MEL, aggregating to Rs 50 crore for the proportionate ownership stake.
This is an exclusive arrangement for 500 MW of power purchase by Reliance Industries. According to the exchange filing, “one unit of 600 MW capacity of MEL’s Mahan thermal power plant, out of its aggregate operating and upcoming capacity of 2800 MW, will be designated as the Captive Unit for this purpose.”