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NEW DELHI: Pratik Agrawal-led Sterlite Power Transmission Ltd (SPTL) is demerging its transmission infrastructure business with a view to unlocking value by creating distinct verticals based on consumer base, investor class and return profiles.
Under the demerger scheme, existing Sterlite Power shareholders will receive one additional share of SGL5 for every share of SPTL they hold, the company said on Friday.
The power transmission infrastructure business has transmission assets in India and Brazil, which will now be transferred to Sterlite Grid 5 Ltd (SGL5). Both SPTL and SGL5 will have independent boards and management teams.
The demerged SPTL will continue to hold the global products and specialised EPC (engineering procurement contract) services business as well as the convergence – Fiberco — business, the company said.
“The demerger will enable both entities to create independent capital structures, unlock value and attract investors suitable for the distinct growth profiles for each entity. We are confident that this will bring substantial value for our shareholders and help us in creating two world class business entities,” a company statement on Friday quoted Agrawal as saying.
The demerger aims to tap opportunities presented by a projected doubling of transmission network globally in the next 8 years to meet aggressive renewable energy capacity additions.
The company expects statutory approvals within the next 6-8 months, including those from shareholders, creditors, and various regulatory authorities.
The demand for power products is expected to remain strong over the medium-term on the back of healthy demand, amid aggressive global capex earmarked for renewables capacity addition, expansion in transmission & distribution networks, benefits from ‘China+1’ theme and favourable tariff structures in the US.
Under the demerger scheme, existing Sterlite Power shareholders will receive one additional share of SGL5 for every share of SPTL they hold, the company said on Friday.
The power transmission infrastructure business has transmission assets in India and Brazil, which will now be transferred to Sterlite Grid 5 Ltd (SGL5). Both SPTL and SGL5 will have independent boards and management teams.
The demerged SPTL will continue to hold the global products and specialised EPC (engineering procurement contract) services business as well as the convergence – Fiberco — business, the company said.
“The demerger will enable both entities to create independent capital structures, unlock value and attract investors suitable for the distinct growth profiles for each entity. We are confident that this will bring substantial value for our shareholders and help us in creating two world class business entities,” a company statement on Friday quoted Agrawal as saying.
The demerger aims to tap opportunities presented by a projected doubling of transmission network globally in the next 8 years to meet aggressive renewable energy capacity additions.
The company expects statutory approvals within the next 6-8 months, including those from shareholders, creditors, and various regulatory authorities.
The demand for power products is expected to remain strong over the medium-term on the back of healthy demand, amid aggressive global capex earmarked for renewables capacity addition, expansion in transmission & distribution networks, benefits from ‘China+1’ theme and favourable tariff structures in the US.
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