Adani Total Gas Secures Largest Global Financing Of $375 Million For CGD Business
The development also assumes significance in view of the Indian government’s target of increasing the share of natural gas in the energy basket from 6% to 15% by 2030.
(Adani Group's corporate office building in Ahmedabad. Photo: Vijay Sarpate/NDTV Profit)
Adani Total Gas Ltd. said on Friday that it secured a funding of $375 million from international lenders to expand its city gas distribution network. This is the largest global financing in the CGD business, the company said in a release.
The funding will allow ATGL to expand its network to cover "over 200 million people, covering 14% of India’s population". The funding involves an initial commitment of $315 million "with accordion feature to enhance the commitments", it said.
Five international lenders, including BNP Paribas, DBS Bank, Mizuho Bank, MUFG Bank and Sumitomo Mitsui Banking Corp. participated in the initial financing, the release added.
The investment will fast track the capital expenditure to expand the company's gas distribution network into "34 authorised geographical areas across 13 states", ATGL said.
The expansion will deepen the penetration of piped natural gas and compressed natural gas infrastructure, creating an "ecosystem for a gas-based economy", it added.
"Participation from the global lenders reinforces the potential of city gas distribution in its role as transition fuel," said Parag Parikh, chief financial officer of ATGL.
This financing framework will drive the company's "sustained growth and will be a stepping-stone for future financing based on its capital management plan, which will create a long-term value for all our stakeholders", Parikh added.
The development also assumes significance in view of the Indian government’s target of increasing the share of natural gas in the energy basket from 6% to 15% by 2030.
ATGL's peers in the CGD business are some of the public sector undertakings, including Mahanagar Gas Ltd., Indraprastha Gas Ltd., Gujarat Gas Ltd. and GAIL Gas Ltd.
The announcement related to the $375-million investment was made after the market hours. Shares of ATGL settled 1.61% higher at Rs 788.7 apiece on the NSE, compared to a 1.48% advance in the benchmark Nifty.
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