NTPC, a state-run electricity provider, will reportedly be unable to close an acquisition deal worth nearly ₹10,000 crore, to transfer management control of THDC India Ltd. and NEEPCO (North Eastern Power Corporation) to NTPC in this fiscal year.
Under the terms of the agreement, 74.23% shares in THDCIL and 100% shares in NEEPCO, held by the Government of India, are to be divested, with management control set to be transferred to NTPC. The government’s stake in both firms was expected to be transferred for the ongoing fiscal year 2019-20, in order to meet the overall disinvestment target, set at ₹1.05 lakh crore.
However, the company (NTPC) will not be able to complete the transaction from THDC India and NEEPCO this fiscal year as it awaits deal evaluation by SBI Capital. Furthermore it is likely that the process itself will take few more months to complete.
As of March 31st, 2019, the net worth of NEEPCO and THDCIL were valued at ₹6,301.29 crore and ₹9,280.78 crore, respectively, according to the annual reports of companies.
NEEPCO currently operates several power plants, including 7 hydro, 3 thermal, and 1 solar, with the combined installed power generation capacity of 1,457 MW. The company is also developing 1 hydro power plant of 600 MW, which is expected to be commissioned in the fiscal year 2019-20.
On the other hand, THDCIL has 2 hydro power generation plants, namely, Tehri (4X250 MW) and Koteshwar (4X100 MW). It also has 2 operational wind power plants at Patan (25X2 MW) and Devbhumi Dwarka (30X2.1 MW) in Gujarat. The company’s cumulative installed power generation capacity is 1,513 MW.
RBSA Advisors are being employed by DIPAM (Department of Disinvestment and Public Asset Management) to evaluate NEEPCO and Deloitte for THDCIL transactions.
In November 2019, the divestment of the stake for the Government of India in NEEPCO and THDCIL was carried out after the finance ministry’s proposal to the CCEA (Cabinet Committee on Economic Affairs) was approved.