Larsen & Toubro today announced the divestment of 100 per cent stake in the 3 x 33 MW (99 MW) run-of-the-river hydroelectric power plant owned by its subsidiary L&T Uttaranchal Hydropower Ltd (LTUHPL) to Renew Power Services Private Ltd. This is in line with the declared L&T focus of divesting non-core assets and improving shareholder value.
The transaction is subject to completion of customary closing conditions; closing is expected to take place before September 30, 2021. The sale consideration is ₹985 crore.
“This development is a significant step in our effort to unlock the value of some of our power development assets, to streamline and allocate capital to create long-term value for our shareholders,” said DK Sen, whole-time Director, Larsen & Toubro, describing the sale of the asset. “It represents our strategic effort to increase focus on our core strengths and exit others, to move towards becoming a more asset-light organisation.”
Speaking about the acquisition, Sumant Sinha, Founder, Chairman, and CEO of ReNew Power, said, “Given that the asset is already operational, the acquisition is not only value accretive for us, but also presents a lower level of risk. It strengthens our ability to provide firm and round-the-clock power to the grid and compliments our solar and wind assets, filling up an important position in our portfolio. We will be looking to acquire more hydro assets in the future, as they are the best clean balancing sources for intermittent renewable energy.