Tata Power scraps $300-million fund-raising deal with Olympus Capital
03 Jan 2011
Private sector power major Tata Power has terminated its deal to raise $300 million by selling around 15 per cent stake in two separate special purpose vehicles that own Indonesian coal mines to private equity firm Olympus Capital.
Tata Power Ltd, India's largest private sector power utility, said the company opted to end the deal as some of the conditions could not be fulfilled.
The investment was subject to certain conditions that weren't fulfilled and the accord was scrapped on 1 January, Tata Power said in a statement filed with the Bombay Stock Exchange.
Olympus Capital, a Hong Kong-based private-equity firm had agreed to invest $300 million in Bhira Investments Ltd and Bhivpuri Investments Ltd, the two special power vehicles of Tata Power.
The funding would have helped Tata Power to pay for securing more supplies by investing in mines and to reduce debt.
Tata Power had, in March 2007, agreed to buy a 30-per cent stake in coal mining units PT Kaltim Prima Coal and PT Arutmin Indonesia for a total of $1.3 billion.