Reliance, led by Mukesh Ambani, has acquired a significant 26 percent stake in Adani Power’s venture situated in Madhya Pradesh, marking the first-ever collaboration between the rival billionaires, Mukesh Ambani and Gautam Adani, in the power sector within the region. This strategic move entails Reliance utilizing 500 MW of electricity generated by the project for its internal consumption, as outlined in the agreement signed between the two tycoons.
Reliance’s involvement includes acquiring 5 crore equity shares valued at ₹10 each, totaling ₹50 crore, in Mahan Energen Ltd, an entity wholly owned by Adani Power Ltd. This transaction is a part of a broader arrangement wherein Reliance will hold a 26 percent ownership stake in Mahan Energen Ltd, corresponding to its share of the power plant’s total capacity earmarked for captive use.
Adani Power, through its subsidiary Mahan Energen Ltd, has secured a 20-year power purchase agreement (PPA) with Reliance Industries Ltd (RIL) for the supply of 500 MW of electricity under the captive user policy defined in the Electricity Rules of 2005. This agreement necessitates Reliance’s ownership stake in Mahan Energen Ltd to avail itself of the benefits under the captive user policy.
The collaboration between Ambani and Adani, both originating from Gujarat, marks a departure from their historical business rivalry. Despite their diverse business interests, which include oil and gas, retail, telecom, infrastructure, sea ports, airports, coal, and mining, the two moguls have found common ground in the clean energy sector, where they have jointly announced significant investments.
