GMR taps Temasek, ICICI to raise funds

Mohit Bhalla
The Economic Times

The GMR Group is in an advanced stage of talks with Temasek Holdings and ICICI bank to raise Rs 1,200 crore to support the expansion plans of its power generation arm GMR Energy, two persons privy to the discussions said.

Temasek, a sovereign wealth fund of the Singapore government, will invest Rs 600 crore in GMR Energy’s equity, while ICICI Bank will invest an equal amount by subscribing to its non-convertible debentures, said one company executive who asked not to be named. However, he did not disclose the quantum of stake that will be picked up by Temasek. A banker close to the GMR Group said this could lead to the postponement of GMR Energy’s proposed initial public offer. GMR Energy is a wholly-owned subsidiary of the BSE-listed GMR Infrastructure.

“The market for private capital is increasingly becoming robust. If the company manages to raise funds on its own terms, it may not tap the primary market anytime soon,” he said, requesting anonymity. A spokesman for GMR did not deny or confirm the deal. However, he admitted in an e-mailed response that “fund-raising for growth capital is an ongoing process during which a number of parties are met”.

Manish Kejriwal, senior managing director and country head of Temasek, could not be reached for comments. A spokesman for ICICI Bank declined to comment.

ET NOW had reported on October 10 that GMR Energy was planning an initial public offering and that the company would file a draft red herring prospectus by November 30. The company had appointed JP Morgan and Kotak Mahindra Capital Company as lead managers for the proposed issue.

GMR Energy currently operates three power plants — a 235 mw plant in Mangalore, a 200 mw plant in Chennai and a 387 mw plant at Vemagiri in Andhra Pradesh.

The company is also developing power projects with 2000 mw capacity in Orissa and Chhattisgarh and hydropower projects in Uttarakhand, Himachal Pradesh, Arunachal Pradesh and Nepal with a capacity to generate 1200 mw of power.

GMR Energy also has investments in coal assets and owns 94.9% in PT Barasentosa Lestari mines in Indonesia and over 30% stake in Toronto Stock Exchange-listed Homeland Energy Group, which owns coal assets in South Africa. It also owns 10% in Delhi International Airport.

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