Adani Power's ₹7,000 crore deal to acquire DB Power falls through

Adani Power Ltd’s ₹7,017 crore deal to buy the thermal power assets of DB Power has failed after the initial pact expired.

“We wish to inform that the long stop date under the memorandum of understanding dated August 18, 2022, has expired,” Adani Power said in a regulatory filing on Wednesday (February 15).

In August 2022, Adani Power had informed the bourses that it had agreed to acquire DB Power Ltd (DB Power), which owns and operates a running 2×600 MW thermal power plant at Janjgir Champa district in Chhattisgarh.

Queries regarding the status of the deal sent to Adani Power did not elicit any response.

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This assumes significance in view of the allegations of fraud against the Adani group by the US-based short-seller Hindenburg Research. This issue also rocked Parliament earlier this month and the Opposition had demanded a Joint Parliamentary Committee as well as a Supreme Court-monitored probe into the issue.

The initial term of the MOU (memorandum of understanding) was October 31, 2022. Later the deadline for the transaction got four extensions – till November 30, 2022, December 31, 2022, January 15, 2023 and February 15, 2023.

DB Power is engaged in the business of establishing, operating, and maintaining a thermal power generating station in Chhattisgarh.

DB Power has long and medium-term power purchase agreements for 923.5 MW of its capacity, backed by fuel supply agreements with Coal India Ltd, and has been operating its facilities profitably.

(With Agency inputs)