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  3. Sterlite power gets green light for demerger, to split into two entities

Sterlite power gets green light for demerger, to split into two entities

23 May 2024

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Key Takeaways

  • Overwhelming Stakeholder Consensus:

    • SPTL’s demerger received near-unanimous approval from all stakeholders.

      • Creates two entities: Sterlite Grid 5 Limited and SPTL.

      • Facilitates independent growth and investment strategies.

  • Transmission Infrastructure business:

    • Attracts stable, long-term investments and  increasing demand for robust power.

  • GPS business:

    • Targets higher returns, with INR 7,000 crores in orders in FY24 (up 35% year-on-year).

  • Overwhelming Stakeholder Consensus:

    • SPTL’s demerger received near-unanimous approval from all stakeholders.

      • Creates two entities: Sterlite Grid 5 Limited and SPTL.

      • Facilitates independent growth and investment strategies.

  • Transmission Infrastructure business:

    • Attracts stable, long-term investments and  increasing demand for robust power.

  • GPS business:

    • Targets higher returns, with INR 7,000 crores in orders in FY24 (up 35% year-on-year).

Sterlite Electric Unlisted Shares

Sterlite Electric

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Expert Analysis

Sterlite Power Secures Near-Unanimous Approval for Demerger, Creating Two Strategic Entities.

Expert Analysis:

  • Sterlite Power Transmission Limited (SPTL) secured unanimous stakeholder approval for the demerger of its transmission business.

    • 100% approval from secured creditors and non-fund-based lenders.

    • 99.26% approval from unsecured creditors.

    • 99.99% approval from equity shareholders.

  • Demerger will result in two distinct entities:

    • Sterlite Grid 5 Limited for Transmission Infrastructure.

    • SPTL for Global Products & Specialized EPC Services.

  • Restructuring aims:

    • Enable targeted growth strategies.

    • Attract tailored capital investments.

  • GPS business:

    • Targets higher-return, pre-IPO capital.

    • Secured orders worth INR 7,000 crores in FY24, a 35% year-on-year increase.

  • Pratik Agarwal's Endorsement: Pratik Agarwal, Managing Director of SPTL, supports the strategic rationale behind the demerger.

Publisher:The Ecoonomic Times