Sajjan Jindal's JSW Energy looks set to acquire a 1,000 MW power plant in Raigarh, Chhattisgarh from Jindal Steel and Power Ltd., controlled by his younger brother Naveen, in a deal that involves takeover of the project's debt.
The transaction is expected to be finalised on Wednesday followed by a formal announcement, three people familiar with the development said.
"Both boards are likely to clear the proposal tomorrow along with the quarterly numbers following which a binding agreement will get inked," one of them said on Tuesday. "The valuation is expected to be between Rs 6,000 crore and Rs 6,500 crore," he added.
The others, however, said JSW is likely to pay only Rs. 4,000-4,500 crore initially, which would include a bridge loan of Rs. 3,500 crore and the rest as upfront cash consideration.
Upon the completion of certain preagreed milestones like formalisation of power purchase agreements, JSW may pay a second tranche. The company will also take over the project's debt of around Rs 4,000 crore.