Last checked at 10 Jun 2009 07:00
June 9, 2009
Sub: Approval to the Scheme of Arrangement between
Reliance Infrastructure Ltd and its wholly owned subsidiaries
Further to our letter dated May 18, 2009, we wish to inform you that the equity shareholders of Reliance Infrastructure Limited, at their meeting convened pursuant to the Order of the Hon'ble High Court of Judicature at Bombay, held on June 9, 2009 have approved the Scheme of Arrangement between the Company and its wholly owned subsidiaries Reliance Energy Generation Limited, Reliance Goa and Samalkot Power Limited, Reliance Power Transmission Limited, Reliance Energy Limited, Reliance Infraventures Limited and Reliance Property Developers Limited and their respective shareholders and creditors under Sections 391 to 394 of the Companies Act, 1956. The votes cast in favour of the resolution approving the Scheme were 99.9993% of the total votes cast at the meeting.
A copy of the Media Release being issued by the Company is attached.
We request you to inform your members, accordingly.
Yours faithfully
For Reliance Infrastructure Limited
Ramesh Shenoy
Company Secretary
MEDIA RELEASE
SHAREHOLDERS OF RELIANCE INFRASTRUCTURE LIMITED
APPROVE THE SCHEME OF ARRANGEMENT FOR DEMERGER OF
THE FOLLOWING DIVISIONS OF THE COMPANY
DAHANU THERMAL POWER STATION
GOA AND SAMALKOT POWER STATIONS
POWER TRANSMISSION
POWER DISTRIBUTION
TOLL ROADS
REAL ESTATE
TO THE RESPECTIVE WHOLLY OWNED RESULTING COMPANIES
Mumbai, June 9, 2009: The equity shareholders of Reliance Infrastructure Limited (RInfra), at their meeting convened pursuant to the Order of the Hon'ble High Court of Judicature at Bombay, held on June 9, 2009, have approved the Scheme of Arrangement (Scheme) for demerger of the following Divisions of the Company with the respective Resulting Companies under Sections 391 to 394 of the Companies Act, 1956 with requisite majority.
Dahanu Thermal Power Station to Reliance Energy Generation Limited
Goa and Samalkot Power Stations to Reliance Goa and Samalkot Power Limited
Power Transmission Division to Reliance Power Transmission Limited
Power Distribution Division to Reliance Energy Limited
Toll Roads Division to Reliance InfraVentrues Limited
Real Estate Divison to Reliance Property Developers Limited
All the resulting companies are wholly owned subsidiary companies of RInfra.
The demerger of various divisions of RInfra would benefit the respective companies and the stakeholders of respective companies on account of the following reasons:
Simplified and transparent business structure and alignment of interest of various stake holders;
Attribution of appropriate risk and valuation to different businesses based on their respective risk-return profile and cash flows;
More focused management;
Optimal financing structure for individual businesses;
Greater visibility on the performance of individual businesses;
Possibility of investments by strategic players in different businesses, and
Tax efficiency for individual businesses.
The said Scheme is now subject to requisite approvals and sanctions, inter-alia of Hon'ble High Court of Judicature at Bombay.
About Reliance Infrastructure Limited
Reliance Infrastructure Limited is part of the Reliance Anil Dhirubhai Ambani Group. The group currently has a market capitalization of around Rs 1,65,000 crore (US$ 35.1 Bn), net worth in excess of Rs 64,000 crore (US$ 13.6 Bn), operating cash flow of Rs 13,000 crore (US$ 2.8 Bn) and net profit of around Rs 8,400 crore (US$ 1.8 Bn).
In the power sector, the company is involved in generation, transmission, distribution and trading of electricity and constructing power plants as EPC contractor, having strong order book position of Rs 21,510 crore (US$ 4.6 Bn).
In the infrastructure space, the company is developing Roads, Metro projects and also pursuing other Infrastructure verticals like Ports, Airports, SEZ and Real Estate.
Reliance Infrastructure is developing 11 infrastructure projects worth Rs 12,800 crore and there are 3 projects worth Rs 16,800 crore which are awarded or the company is the preferred bidder. A large number of new mega infrastructure projects are also soon being put to bid, to provide further impetus to the country's rapidly accelerating economic growth.