Power Finance Corporation Transfers Entire Stake In MEL To Power Grid For Rs 8.53 crore

New Delhi, June 5, 2025 — Power Finance Corporation Ltd (NSE: PFC, BSE: 532810), has transferred its entire stake in MEL Power Transmission Ltd to Power Grid Corporation of India for a deal valued at ₹8.53 crore signaling a shift in India’s power transmission strategy.

Strategic Asset Transfer Finalized on June 4

The deal, finalized on June 4, 2025, officially transferred MEL Power Transmission Ltd, a special purpose company (SPV) set up to build the important transmission infrastructure for getting power out of Mahan Energen Limited’s Generating Station in Madhya Pradesh.

The purchase includes 10,000 equity shares at their face value, as well as MPTL’s assets and debts as of the date of the purchase. The final purchase price may change dependent on MPTL’s audited financials. The transmission project includes building a 400 kV double circuit transmission line and bays at the Rewa PowerGrid substation.

Before the transfer, MEL Power Transmission Ltd a fully owned subsidiary of PFC Consulting Ltd, which is also completely owned subsidiary of Power Finance Corporation (PFC). Power Grid Corporation of India will now own this project, making it easier to carry out and in line with the government’s goal of improving power transmission networks across the country.

Transaction Details

The consideration was determined based on Ministry of Power guidelines applicable to SPV transfers. The financial impact of the sale on PFC is negligible, as MEL Power Transmission did not contribute materially to the turnover or net worth of the company in the previous fiscal year.

Compliance and Transparency

Power Finance Corporation confirmed that the transaction does not fall under the category of related party transactions and was executed at arm’s length. Additionally, the deal structure does not qualify as a slump sale, further supporting its standalone nature and regulatory alignment.

This move aligns with PFC’s broader objective of supporting infrastructure development through effective SPV monetization and strategic divestments in line with government frameworks.

REF: https://nsearchives.nseindia.com/corporate/PFC2023_05062025133842_Intimation05062025_signed.pdf

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