US private equity firm and global buyout major Blackstone Group has bought a 12.5 per cent stake in power producer Monnet Power Co for Rs275 crore ($59 million).

Monnet Power, a subsidiary of steel-maker Monnet Ispat and Energy, is registered in Raipur and is currently in the process of developing a 1,050 MW coal-fired power plant in Orissa, a release issued in Mumbai said.

The transaction values the enterprise incorporated in 2006 at Rs2,200-crore.

Commenting on the investment made in an energy-deficient country like India, chairman and managing director of Blackstone Advisors India Pvt Ltd Akhil Gupta said, "We believe that Monnet Power with its mine-mouth coal plant has one of the lowest costs of producing power and, hence is among the best-positioned IPPs (independent power producers) in the country."

MPC's project pipeline includes installing an additional 2,000 MW. The parent company is India's second largest manufacturer of integrated coal-based sponge iron. It is also into mining coal and power generation for captive consumption.

Blackstone Group plans to invest roughly $1-1.5 billion in Indian infrastructure over the next five years, with the power sector especially attractive, Gupta India said today.