Adani Power on Monday received approval from the committee of creditors for acquiring Vidarbha Industries Power Ltd (VIPL), which is undergoing insolvency proceedings. VIPL owns and operates a 2x300 MW (600 MW) thermal power plant at MIDC Industrial Area, Butibori, Nagpur, Maharashtra, a regulatory filing stated. The implementation of Adani Power’s resolution plan is subject to the terms of the LOI (letter of intent) and requisite approvals, including from the National Company Law Tribunal, Mumbai. “Committee of Creditors (COC) of Vidarbha Industries Power, a company undergoing Corporate Insolvency Resolution process has approved the Resolution Plan submitted by Adani Power. In this regard, APL has received a Letter of Intent from Resolution Professional on Monday,” the filing said. Though the filing has not disclosed the value of acquisition, the deal is expected to be in the range of Rs 2,000 cr to Rs 3,000 crore. According to highly placed sources the Gautam Adani-led group is likely to take over the plant and start power generation very soon.

 

The value of the deal could translate into Rs 4-5 crore per MW. The 600 MW coal-fired thermal power plant comprising two units of 300MW each in the Butibori industrial area in the district was closed in 2019. The project could have been valued near Rs 6,000 crore. However, it has been shut and that has affected its valuation, the sources added. The power plant, which was once owned by bankrupt Reliance Power, is now under Vidarbha Industries Power, a subsidiary of Rel Power. The Adani-led group was negotiating the deal with CFM Asset Reconstruction Company, which is the only lender to the power project. Last year, CFM Asset Reconstruction Company became the new and sole lender of Vidarbha Industries Power after it acquired its loans from various lenders at Rs 1,265 crore. The plant, set up in 2013-14, was one of the most modern power generation plants in the country.

 

It was also considered as one of the most compact power plants in the country. Another positive factor is that the plant is connected to a railway station with its 26km-long siding. Railway track connectivity gives added advantage to a power plant as it significantly reduces coal transportation.