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GMR to raise US$200 million for energy expansion

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GMR Energy Limited (GEL), a subsidiary of Bangalore-based infrastructure major GMR Group, has signed a shareholders agreement with Temasek Holdings to raise capital for its energy expansion plans. The company plans to enhance its installed power generation capacity from the current 808 MW to more than 6,500 MW over the next three-four years, thus necessitating significant capital investment to fund its expansion plans in the energy business.
GM Rao, GMR Group Chairman said, “Temasek is an established investor globally and one of the earliest investors in India. We are confident that this relationship will be a mutually gratifying experience for both parties.”
The company said that it has already achieved financial closure and achieved fuel linkages for GMR Kamalanga (1,050 MW) and Emco Energy (600MW). Several other projects are also in advanced development stage, it added.
The Singapore-based investment firm which also has investments in other Indian companies such as ICICI Bank, Mahindra & Mahindra, Tata Teleservices, Bharti Infratel, Punj Lloyd, will invest US$200 million through its wholly-owned subsidiary Claymore Investment (Mauritius). The investment will be through a structured paper compulsorily convertible into equity.
“The energy sector within the infrastructure space is an attractive long-term investment area. India may have historically lagged behind in adding new generation capacity, we believe that enabling regulations and private sector participation will allow the sector to add substantially to India’s GDP growth rate,” said, Manish Kejriwal, Head of Temasek Holdings India.

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