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IDFC and India Infrastructure Fund take 20 per cent stake in INR45.4bn energy project

The Infrastructure Development Finance Company (IDFC) and the IDFC Project Equity Company, which manages the India Infrastructure Fund (IIF), have taken a 20 per cent equity stake in GMR Kamalanga Energy, a special purpose vehicle (SPV) set up by Indian infrastructure developer GMR Group to implement a thermal power plant.

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IIF is to hold 15 per cent of the SPV, while IDFC will take five per cent. The goal of the Kamalanga project is to install a 1,0505MW coal-powered thermal power plant in the Dhenkanal District, Orissa, at an estimated cost of INR45.4bn ($978.7m).

The project has a dedicated coal allotment and secure fuel linkage, and already has a large portion of its output allocated to various long-term power purchase agreements, according to IDFC.

The deal was led by Aditya Aggarwal of IDFC Project Equity, who said, “DFC group’s relationship with GMR group is almost a decade old and this investment further consolidates the same. GMR group is one of the very few industrial houses in India which has an exhibited track record of executing large scale infrastructure projects within budgeted time and costs. We continue to be selectively bullish on opportunities in the Indian power sector and are quite excited to partner with the GMR group for their GKEL project, which is one of the more advanced power projects in Orissa.”

The IDFC was set up in 1997 to finance and catalyse the development of private sector funded infrastructure projects in India, going public in July 2005. The Indian Infrastructure Fund was set up by the Indian government and various international financial institutions to invest $5bn in capital for infrastructure projects in India. The IIF currently manages $925m, and targets infrastructure assets with strong, predictable cash flows and low volatility. Portfolio companies include Ashoka Highways, Essar Power and JAS Toll Road Company.
Source: Alt Assets

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