Tata Power, through its wholly-owned subsidiaries, is selling its entire 30% stake in Indonesian coal miner PT Arutmin Indonesia and associated companies in coal trading and infrastructure to a Bakrie Group entity for US$500 million.
The deal, which is subject to certain conditions and restructuring actions, is expected to be complete by the end of April. It is aimed at helping Tata provide required cash flow and reduce debt.
Tata acquired stakes in Arutmin and PT Kaltim Prima Coal for about US$1.3 billion in 2007 to meet the proposed needs of the 4000 MW Mundra power plant and other planned projects. It will retain its stake in Kaltim Prima and says the Arutmin sale will not affect supplies to Tata plants.