GMR Group’s strategic sale of power assets to reduce debt, strengthen finances

GMR Power and Urban Infra Limited (GPUIL) has announced plans to divest its stake in non-operating and stressed assets. This decision follows their March 31, 2025, intimation regarding a settlement with lenders of GMR Rajahmundry Energy Limited (GREL), an associate company. The divestment aims to reduce debt levels, strengthen the GMR Group’s financial health, and meet funding requirements for the settlement with GREL’s lenders.  

GPUIL, along with its wholly-owned subsidiary GMR Energy Limited (GEL) and subsidiary GMR Generation Assets Limited (GGAL), has signed a framework agreement with Synergy Investments Holding Limited (Synergy) for the divestment.  

The agreement involves the transfer of stakes in:

• GMR Bajoli Holi Hydropower Private Limited (Bajoli Holi), a 180 MW hydro-electric power project.  
• GMR Vemagiri Power Generation Limited (Vemagiri), a 388 MW natural gas-based combined cycle power plant.  
• GMR Rajahmundry Energy Limited (GREL), a 768 MW natural gas-based combined cycle power plant.  

Synergy Investments Holding Limited is not part of the promoter group and is not a related party to the GMR Group.  

Under the framework agreement, GEL will transfer 79.86% of the equity shares of Bajoli Holi to Synergy in two tranches, along with 100% of the compulsorily convertible debentures issued by Bajoli Holi. GEL will also transfer 51% of the equity shares of Vemagiri to Synergy. GGAL will transfer 51% of the equity shares of GREL to Synergy, upon completion of the proposed One-Time Settlement (OTS) with lenders.  

The GREL and Vemagiri power plants have been non-operational due to the unavailability of affordable natural gas.  

The consolidated consideration for the transfer of securities under the framework agreement is Rs 653 crores, subject to working capital and other adjustments at closing. The transaction is expected to be completed on or before September 30, 2025, or a later date as agreed upon by the parties.  

This transaction will enable GPUIL to meet the proposed OTS with GREL’s lenders, reduce debt by approximately Rs 4,400 crores, and spin off non-operational gas plants and stressed assets. The company expects this to further improve its bottom line.  

Synergy Investments Holding Limited is owned by a private equity fund managed by Synergy Capital, an investment manager and advisor with offices in the UAE, Singapore, and India. Synergy Capital focuses on the industrial and infrastructure sectors.  

Srinivas Bommidala, Managing Director of GPUIL, stated that the divestment will help settle obligations with lenders and allow the company to focus on growing its platform. Sudhir Maheshwari, Founder and Managing Partner of Synergy Capital, expressed confidence in creating value through the acquisition.  

GMR Power and Urban Infra Limited, a listed infrastructure company of the GMR Group, has a presence in the energy, urban infrastructure, and transportation sectors. The company is also developing clean energy projects in India and Nepal and is involved in new-age opportunities like Smart Meters and Smart Mobility.  The group has a significant presence in airport development through GMR Airports Limited (GAL) and also has interests in sports.  

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