Adani Power’s Acquisition of Lanco Amarkantak Gets CCI Nod

The Indian thermal power market witnessed a major shakeup on March 26, 2024, as the Competition Commission of India (CCI) approved Adani Power Limited’s acquisition of Lanco Amarkantak Power Limited. This move signifies a strategic step by Adani Power to solidify its position as a dominant player within the sector.

Lanco Amarkantak’s Insolvency Paves the Way

The acquisition comes after Lanco Amarkantak Power had entered into a Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code (IBC) in September 2019. Following a delayed process, Adani Power emerged as the frontrunner with a winning bid of Rs 4,101 crore ($492 million) in February 2024 . This successful bid grants Adani Power complete ownership (100% equity share capital) of Lanco Amarkantak.

Potential for Price Shifts and Reshuffled Dynamics

Industry experts anticipate this acquisition to significantly bolster Adani Power’s market presence. The company already boasts a wide portfolio of operational thermal power plants across several Indian states, including Gujarat, Maharashtra, and Madhya Pradesh . With the addition of Lanco Amarkantak’s 1.92GW capacity, Adani Power is poised to become an even more influential force. The long-term ramifications of this consolidation have the potential to impact electricity prices and reshape market dynamics within the thermal power sector.

The CCI’s Role in Ensuring Fair Play

The CCI’s approval serves as a vital safeguard against the creation of an unfair market monopoly. Their green light indicates that, following a thorough assessment, the acquisition does not pose a significant threat to healthy competition within the relevant market. This suggests that despite the consolidation, a sufficient number of players remain to ensure a competitive landscape in the thermal power sector.

Thermal Power Amidst India’s Clean Energy Push

It’s crucial to acknowledge the ongoing national focus on renewable energy sources like solar and wind. However, thermal power continues to play an essential role in meeting India’s energy demands, especially considering the country’s vast population and developing infrastructure. The long-term impact of this acquisition on the energy mix and clean energy initiatives remains to be seen. It will be interesting to observe how Adani Power integrates Lanco Amarkantak’s operations and navigates the evolving energy landscape in India.

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