NTPC Limited — Capital/Financing Update 2020

Mar 26, 2020

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NTPC Limited

(A Govt. of India Enterprises) Corporate Centre

Ref. No.: 01:SEC: NTPC Dated: 26/3/2020

General Manager Manager Department of Corporate Services National Stock Exchange of India Limited BSE Limited Exchange Plaza Floor 25, Phiroze Jeejeebhoy Towers Bandra-Kurla Complex Dalal Street Bandra(E) Mumbai-400 001 Mumbai-400 051

Sub.: Disclosure under Regulation 30 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015

Pursuant to Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, and in continuation of our disclosures dated January 27, 2020 and on March 20, 2020, this is to inform that the Company has, on March 25, 2020, executed a Share Purchase Agreement with the President of India for acquisition of legal and beneficial ownership of 2,73,09,406 equity shares held by the President of India in THDC India Limited ( THDCIL ) and the acquisition of beneficial ownership in 6 equity shares held by the nominees of the President of India in THDCIL (collectively representing 74.496% of the total paid up share capital of THDCIL) for an aggregate consideration of INR 7500 crore (Rupees Seven Thousand Five Hundred Crore only). The acquisition is subject to satisfaction of customary conditions precedent.

A detailed disclosure pursuant to Circular no. CIR/CFD/CMD/4/2015 dated September 9, 2015 issued by the Securities and Exchange Board of India ( SEBI ), is enclosed herewith.

This is for your kind information and records.

Thanking you.

Yours faithfully,

Sd/- (Nandini Sarkar) Company Secretary & Compliance Officer

Enclosed: as above

Registered office: NTPC Bhawan, SCOPE Complex, & Institutional Area, Lodhi Road, New Delhi-110003 CIN:L40101DL1975GOI007966, Telephone: 011-24387333 FAX: 011-24361018, Email: ntpccc@ntpc.co.in Website: www.ntpc.co.in,

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NTPC Limited

(A Govt. of India Enterprises) Corporate Centre

Disclosure by NTPC Limited pursuant to Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, read with Circular no. CIR/CFD/CMD/4/2015 dated September 9, 2015 issued by SEBI

Disclosure on execution of Share Purchase Agreement to acquire 74.496% of equity shares of THDC India Limited from the President of India

S. No.	Particulars	Details
1.	Name of the target entity, details in brief such as size, turnover etc.	The target entity, namely THDC India Limited (“THDCIL”) was incorporated on July 12, 1988. It is a joint venture of the Government of India (74.496%) and the Government of Uttar Pradesh (25.504%) and is a Mini-ratna Category I Central Public Sector Enterprise. THDCIL is primarily engaged in the business of development of conventional/ non-conventional/ renewable sources of energy and river valley projects. As of March 31, 2019, the balance sheet size of THDCIL stood at INR 15,577.83 crore. The authorized share capital of THDCIL is INR 40,00,00,00,000 and the total issued, subscribed and paid- up share capital of THDCIL is INR 36,65,88,17,000, as on the date of acquisition. The total loan book of THDCIL was INR 4,414.78 crore with a turnover of INR 2,850.29 crore and Profit After Tax of INR 1,255.63 crore during 2018-19_(all figures on_ standalone basis).
2.	Whether the acquisition would fall within related party transaction(s) and whether the promoter/ promoter group/ group companies have any interest in the entity being acquired? If yes, nature of interest and details thereof and whether the same is done at “arm’s length”	The President of India is the common promoter of both NTPC Limited (51.02%) and THDCIL (74.496%) and is the seller of shares held by it in THDCIL to NTPC Limited. The proposed transaction is thus a related party transaction between the Government of India and a government company, i.e. NTPC Limited within the meaning of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR Regulations”) and the Companies Act, 2013 (“Act”). SEBI has granted necessary exemption from the application of Regulations 23(2) and 23(4) of the LODR Regulations to NTPC Limited for this proposed transaction_vide_its letter dated February 18, 2020. Section 188(1) of Act read with Rule 15(3) of the Companies (Meetings of Board and its Powers) Rules, 2014(“Rules”) specifies the limits for transactions beyond which a related party transaction shall require approval of the shareholders. Ministry of Corporate Affairs has_vide_Notification No. G.S.R. 463(E), dated June 5, 2015, read with notification dated March 2, 2020 _inter alia_exempted the application of the first and second proviso to Section 188(1) of the Act to contracts or arrangements entered into by a Government company with the Central Government. The proposed transaction between NTPC Limited (a Government

Registered office: NTPC Bhawan, SCOPE Complex, & Institutional Area, Lodhi Road, New Delhi-110003 CIN:L40101DL1975GOI007966, Telephone: 011-24387333 FAX: 011-24361018, Email: ntpccc@ntpc.co.in Website: www.ntpc.co.in,

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NTPC Limited

(A Govt. of India Enterprises) Corporate Centre

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Company) and the Government of India (Central Government) is
thus exempt from the requirement of taking approval from
shareholders under Section 188(1) of the Act.
The proposed transaction is at arm’s length price.
3. Industry to which the Power
entity being acquired
belongs
4. Objects and effects of The Cabinet Committee on Economic Affairs (“ CCEA ”) in its
acquisition (including meeting held on November 21, 2019, granted an ‘in-principle’
but not limited to, approval to the proposal of the Department of Investment and
disclosure of reasons Public Asset Management, Ministry of Finance, Government of
for acquisition of target India, for the strategic disinvestment of Government of India’s
entity, if its business is shareholding in THDCIL to NTPC Limited along with transfer
outside the main line of of management control. In furtherance to the said decision of the
business of the listed CCEA, the Board of Directors of NTPC Limited vide resolution
entity) dated January 27, 2020 granted an in-principle approval for the
acquisition of the entire stake held by the Government of India in
THDCIL. Subsequently, requisite approvals were obtained from
SEBI and the Competition Commission of India (“ CCI ”).
The takeover of THDCIL i.e. primarily a hydropower generating
company would help NTPC Limited to unlock potential
synergies with many of its existing projects and gain deep domain
expertise in developing hydropower projects in difficult terrains
of the country. NTPC has conducted a thorough evaluation of the
said transaction and the same will benefit NTPC as THDCIL has
operational portfolio of 1513 MW comprising hydro power
generation portfolio of 1,400 MW and wind power generation
portfolio of 113 MW. Further, it has projects with aggregate
capacity of 2,838 MW (1,468 MW – hydro power projects, 50
MW – solar power project and 1,320 – thermal power project)
under various stages of implementation.
5. Brief details of any 1. The CCEA has provided its in-principle approval for the
governmental or proposed acquisition on November 21, 2019;
regulatory approvals
required for the 2. SEBI has granted exemption dated February 18, 2020 for
acquisition exemption from obtaining audit committee and
shareholders’ approval for related party transaction
under Regulations 23(2) and 23(4) of LODR
Regulations; and
3. CCI has granted approval dated February 24, 2020 under
Section 31(1) of the Competition Act, 2002.
6. Indicative time period On or before March 31, 2020.
for completion of the
acquisition
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Registered office: NTPC Bhawan, SCOPE Complex, & Institutional Area, Lodhi Road, New Delhi-110003 CIN:L40101DL1975GOI007966, Telephone: 011-24387333 FAX: 011-24361018, Email: ntpccc@ntpc.co.in Website: www.ntpc.co.in,

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NTPC Limited

(A Govt. of India Enterprises) Corporate Centre

7.	Nature of consideration - whether cash consideration or share swap and details of the same	Cash consideration.
8.	Cost of acquisition or the price at which the shares are acquired	INR 2,746.31 (Rupees two thousand seven hundred forty-six and thirty-one paise only) per share and total consideration of INR 7500 crore (Rupees Seven Thousand Five Hundred Crore Only).
9.	Percentage of shareholding/ control acquired and/ or number of shares acquired	Acquisition of legal and beneficial ownership of 2,73,09,406 Equity Shares of face value of INR 1000 per share and the beneficial ownership in 6 Equity Shares of face value of INR 1000 per share, collectively amounting to 74.496% of the total paid up capital of THDCIL.
10.	Brief background about the entity acquired in terms of products/ line of business acquired, date of incorporation, history of last 3 years turnover, country in which the acquired entity has presence and any other significant information (in brief)	Name: THDC India Limited Date of Incorporation: 12.07.1988 CIN: U45203UR1988GOI009822 Whether listed: The equity shares of THDCIL are unlisted. The corporate bonds issued by THDCIL are listed on the BSE Limited and the National Stock Exchange of India Line of business: Power generation Country of presence: India Turnover during last three years:FY 2016-17 - INR 2235.97 crore, FY 2017-18 - INR 2223.19 crore, FY 2018-19 - INR 2850.29 crore

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Registered office: NTPC Bhawan, SCOPE Complex, & Institutional Area, Lodhi Road, New Delhi-110003 CIN:L40101DL1975GOI007966, Telephone: 011-24387333 FAX: 011-24361018, Email: ntpccc@ntpc.co.in Website: www.ntpc.co.in,