Global lenders have provided financing to India’s leading City Gas Distribution (CGD) company, Adani Total Gas Ltd (ATGL). ATGL has entered into an overall financing framework that enables ATGL to secure future funding based on its business plan.
Financing of $375 million
The maiden financing of USD 375 million executed with international lenders includes an initial commitment of USD 315 million with an accordion feature to enhance the commitments. Five international lenders participated in the initial financing which includes BNP Paribas, DBS Bank, Mizuho Bank, MUFG Bank, and Sumitomo Mitsui Banking Corporation.
The facility will fast-track the capital expenditure program enabling ATGL to rapidly expand its CGD network into its 34 authorized Geographical Areas (GAs) across 13 states. This development agenda shall cater to up to 14% of India’s population covering more than 200 million people. The expansion will deepen the penetration of Piped Natural Gas (PNG) and Compressed Natural Gas (CNG) infrastructure, creating an ecosystem for a gas-based economy.
ATGL strives to lead energy transition
ATGL remains steadfast in its approach to lead the energy transition in India by fuelling increased usage of PNG and CNG to replace high carbon-intensive conventional fuel sources and thereby creating a positive impact on the environment. PNG and CNG usage offer a convenient, cost-effective, reliable and eco-friendly fuel and will further support the Government’s vision of increasing the share of natural gas in the energy basket from 6% to 15% by 2030.
“Participation from the global lenders reinforces the potential of city gas distribution in its role as transition fuel”. said Mr. Parag Parikh, CFO of ATGL. “This financing framework will drive ATGL’s sustained growth and will be a stepping-stone for future financing based on its capital management plan which will create a long-term value for all our stakeholders”.
ATGL has been instrumental in the creation of a transition energy platform for its large consumer base by providing network infrastructure across multiple GAs and also promoting sustainable energy in the form of E-mobility, LNG for transport and Biomass to lead the charge of India’s energy transition.
Latham & Watkins LLP and Saraf & Partners were the borrower’s counsel and Linklaters and Cyril Amarchand Mangaldas were the lender’s counsel for this financing.
About Adani Total Gas (ATGL)
Given its gas distribution, ATGL is authorised in 34 Geographical Areas and plays a significant role in the nation’s efforts to enhance the share of natural gas in its energy mix. Of the 53 GAs, 34 are owned by ATGL and the balance 19 GAs are owned by Indian Oil-Adani Gas Private Limited (IOAGPL) – a 50:50 joint venture between Adani Total Gas Limited and Indian Oil Corporation Limited. Further, ATGL has formed 2 wholly owned subsidiaries namely Adani TotalEnergies E-Mobility Ltd (ATEL) and Adani TotalEnergies Biomass Ltd (ATBL) for its E-Mobility and Biomass Business respectively. ATGL has also formed a 50:50 joint venture, namely Smart Meter Technologies Private Limited for its gas meter manufacturing business.
