Tata Power Acquires 40% in Khorlochhu Hydro Power for Rs 830 Crore

Tata Power has announced the acquisition of a 40% stake in Bhutan-based Khorlochhu Hydro Power Limited for Rs 830 crore. The company confirmed the completion of a Share Purchase Agreement involving existing shareholders of Khorlochhu Hydro Power Limited (KHPL) in a recent exchange filing.

Approval and Agreement Details

On August 6, the Board of Directors of Tata Power approved the proposal for this strategic acquisition. The 40% equity stake in KHPL will be acquired in one or more tranches for approximately Rs 830 crore. Tata Power has also agreed with Druk Green Power Company to develop the hydro project in Bhutan, which is estimated to cost around Rs 6,900 crore.

Transaction Timeline and Future Investments

The transaction, valued at Rs 830 crore, will be executed in phases. The first tranche is expected to be completed by March 31, 2025, pending regulatory and contractual requirements. Tata Power plans to make further investments over the next five years to support the development of the Khorlochhu Hydropower Project.

Strategic Importance of the Acquisition

This acquisition represents Tata Power’s entry into the 600 MW Khorlochhu Hydropower Project in Bhutan, which is valued at approximately Rs 6,900 crore. The project aligns with Tata Power’s strategic goal of expanding its renewable energy portfolio, reinforcing its commitment to clean energy.

Future Relations and Structure

Upon completion, Khorlochhu Hydro Power Limited will become an associate company of Tata Power, thereby positioning it as a related entity within Tata Power’s growing green energy initiatives. Initially, this acquisition will not involve any related party transactions, as Tata Power and KHPL currently maintain separate shareholder interests.