Adani Power's Rs 7000 crore deal to buy DB Power assets falls through

Adani Power Ltd's Rs 7,017-crore deal to buy thermal power assets of DB Power has fallen 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.

Earlier in August 2022, Adani Power had informed the bourses that it has agreed to acquire DB Power Ltd (DB Power), which owns and operates a running 2x600 MW thermal power plant at district Janjgir Champa in Chhattisgarh.

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

This assumes significance in view of allegations of fraud against Adani group by the US-based short-seller Hindenburg Research. This issue rocked Parliament also earlier this month and opposition had demanded 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.