Vedanta bid for Meenakshi Energy gets CoC nod

The resolution plan submitted by Vedanta Ltd has been approved by the committee of creditors (CoC) of Nellore, Andhra Pradesh-based Meenakshi Energy, Vedanta Ltd informed the exchanges on 18 January.

The resolution plan offers to pay Rs 1,440 crore to creditors of Meenakshi Energy, which owes over Rs 4,625 crore to its financial as well as operational creditors.

Out of the total consideration Rs 312 crore will be paid upfront and balance Rs 1,128 crore will be in the form of secured unlisted non-convertible debentures issued by Meenakshi Energy Limited to the Financial Creditors to be repaid in five equal instalments over a period of 5 years starting from the end of 2nd year.

The resolution application has to be now approved by the National Company Law Tribunal (NCLT).  Vedanta Ltd in the exchange filing said that the acquisition is estimated to be completed in FY2024.

Meenakshi Energy is a 1000 MW coal-based power plant located at Nellore, Andhra Pradesh. Phase I of 300 MW (2*150 MW – Unit 1 & 2) is completed. Remaining Phase II of 700 MW (2*350 MW – Unit 3 & 4) is pending to be tested and declared COD (Commercial Operational Date).

Vedanta says that it will for now operate 1000 MW of Meenakshi Energy Limited as independent power producer to carter to the needs of the market by entering into short- or medium-term power purchasing agreement and by supplying power to merchants. The acquisition will enhance the group’s portfolio in power, says Vedanta Ltd.

Meenakshi Energy Limited is a 1000 MW power plant incorporated on 21st August 1996 and located at Nellore district of Andhra Pradesh, India.

The company was admitted under Corporate Insolvency Resolution Process in terms of the Insolvency and Bankruptcy Code, 2016 and the insolvency proceedings were commenced on 7th November, 2019. State Bank of India had initiated the insolvency proceedings against the company for defaulting on a payment of Rs 1,700 crore.

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