GVK Power ties up Rs698 crore funds from PE firms

GVK Power & Infrastructure Ltd is diluting equity in its energy arm for the second time in a little over a month.

Two leading private equity firms - Actis Advisors Pvt Ltd and an affiliate of the government of Singapore Investment Corporation (GIC) - will invest Rs698 crore in power company GVK Energy Ltd, a wholly owned subsidiary of the Hyderabad-based infrastructure company.

GVK Power said on Thursday it has it signed an agreement with the private equity firms for an investment of Rs.349 crore each in GVK Energy. Actis and GIC's affiliate will bring in Rs218 crore each as the first tranche of investment.

In November, GVK had sold a 21 per cent stake to 3i Infrastructure in GVK Energy for about Rs1,200 crore. With the latest funding, the overall PE investment in GVK Energy has gone up to Rs1,498 crore and the overall dilution would be about 24.97 per cent.

GVK's power portfolio comprises an operational capacity of 909 MW and 4200 MW under various stages of development.

Actis is an emerging markets private equity investor with $4.7 billion under management. GIC is a global investment management company established in 1981 to manage Singapore's foreign reserves.