REL to bid for stake in 5 Distribution Cos in UP Wednesday, December 1 2004 21:38 Hrs (IST)
Mumbai:
After announcing to set up a 3,500 MW power plant in Uttar Pradesh, Reliance Energy Ltd (REL) has decided to participate in international competitive bidding for a majority stake in the State owned five power distribution companies (Discoms).
A decision to this effect was taken by the REL board which had met yesterday (Nov 30, 2004) to consider the resignations of the six directors and related issues, the company said in a statement.
The announcement comes amid media reports that the Rs 11,000 crore investment in Uttar Pradesh was the reason for rift between REL Chairman Anil Ambani and his elder brother Mukesh Ambani, the Chairman of Reliance Industries Ltd, which is the major shareholder in REL.
The five Discoms are responsible for distribution and supply of electricity in Uttar Pradesh and cater to about 8.5 million consumers over 2.4 lakh sq. kms with a peak demand of about Rs 7,500 crore, the release said.
The board had decided to approach the parent company Reliance Industries Ltd on "future prospects" and had reposed full faith in the present management led by Anil Ambani.
The company said the process of divestment of the majority stake of the State Government would take place in two stages and the entire transaction is scheduled to be completed within this fiscal.
