Canada’s CDPQ, SWFs from Oman & Kuwait to light up Tata Power-ICICI Venture’s JV

Canada-based pension fund Caisse de depot et placement du Quebec, and sovereign wealth funds such as the State General Reserve Fund of Oman and Kuwait Investment Authority are in advanced stages of negotiation to form a joint venture (JV) with Tata Power Company Limited (TPCL) and ICICI Venture Funds Management Company to buy out stressed power assets facing high debt, regulatory uncertainties, fuel shortages and low demand. The JV is likely to witness equity investments aggregating $650 million to create a pool of $850 million. The JV also plans to raise additional debt to eventually create a war chest of $4 billion-$5 billion to fund large buyouts. Reportedly, Avantha Power and Infrastructure Limited’s 1,200 MW Jhabua thermal power plant with an estimated enterprise valuation of Rs 40 billion-Rs 45 billion is likely be the first acquisition by the JV.