Monday 7 July 2014

Tata Power rallies over 3% on stake sale reports in Indonesian coal firm.

Tata Power Company LtdBSE 2.43 % rallied as much as 3.03 per cent in trade on Monday after the Company on Friday, said it would sell its 5 per cent stake in PT Kaltim Prima Coal for about $250 million to cut its debt, less than six months after offloading its holding in another Indonesian coal company PT Arutmin. 

At 09:25 a.m.; Tata Power was trading 2.6 per cent higher at Rs 110.20. It hit a low of Rs 109.50 and a high of Rs 110.45 in trade today. 

"Tata Power, facing under recovery and cash flow challenges due to its Mundra UMPP operations has signed options agreements to sell 5 per cent stake in PT Kaltim Prima Coal to get additional cash as well as to reduce its consolidated debt," the company said in a BSE filing. 

The company will sell its stake to Indonesian coal firm Bakrie Group entity. Post-stake sale, Tata Power's stake PT Kaltim Prima Coal (KPC) will be 25 per cent. 


As part of the deal, Tata Power through its subsidiaries has the option to sell 30 per cent stake in power infrastructure companies, which are associated with PT Kaltim Prima Coal, to the Bakrie Group entity, added a PTI report. 


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