Welspun Enterprises, an infrastructure company, has announced that it is going to divest its entire 15.49 percent stake in Welspun Energy, an independent power company. The Board of Directors has, subject to the approval of the members of the company, approved the sale of its entire investment of 60,493,342 equity shares representing 15.49 percent in the paid up equity share capital of Welspun Energy, according to a company filing on the Bombay Stock Exchange.
The stake in Welspun Energy is to be sold to Welshop Trading, for approximately Rs.2.9 billion (~$42.72 million) plus contingent consideration, tripling Welspun Enterprise’s investment of Rs.911 million (~$13.42 million).
“With this transaction, the company continues its journey of consolidation and value creation for all its stakeholders by enhancing focus on its core businesses. This deal will further improve our balance sheet and cash reserves, which has set a stronger platform for future growth,” said Mr. Sandeep Garg, Managing Director, Welspun Enterprises.
The services of PricewaterhouseCoopers and Ernst & Young were utilized for this transaction, and Khaitan & Co, was the joint legal advisor.
In September 2016, Tata Power Renewable Energy acquired 100 percent shareholding in Welspun Renewables Energy (WREPL) and its subsidiaries for $1.4 billion (~Rs.93.8 billion).
Image Credit: Welspun Energy