GE Power India shares slipped more than 2% on Friday after the company said its board had approved a scheme of arrangement with JSW Energy Limited. As of 9:43 AM, the shares were trading 2.49% lower at Rs 358.05.
Under the plan, the Durgapur facility business, which makes and supplies power boiler components, pressure vessels, piping, and coal mills for thermal power plants, will be transferred to JSW Energy as a going concern in line with the Companies Act, 2013. The two companies have also signed a Demerger Co-operation Agreement.
As consideration, shareholders of GE Power India will receive ten fully paid equity shares of JSW Energy of ₹10 each for every 139 fully paid equity shares of GE Power India of ₹10 each. The entitlement ratio was based on valuation reports prepared by RBSA Valuation Advisors LLP and GT Valuation Advisors Pvt Ltd and supported by a fairness opinion from IDBI Capital Markets & Securities Limited.
For the financial year ending March 31, 2025, GE Power India reported revenue of ₹10,471 million and a net worth of ₹2,330.8 million. The Durgapur unit contributed ₹529.5 million in revenue, around 5.1 percent of the total, and posted a negative net worth of ₹203.5 million. JSW Energy reported revenue of ₹12,639.49 crore and profit from operations of ₹1,950.89 crore in FY25 with a paid-up share capital of ₹1,747.77 crore.
The scheme will need approval from shareholders and creditors of both companies, as well as the National Company Law Tribunal, SEBI, stock exchanges, and other authorities. If the transaction cannot be completed under the approved structure, the agreement allows for the Durgapur business to be acquired by JSW Energy through a slump sale.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.