Larsen & Toubro (L&T) is an Indian multinational engaged in technology, engineering, construction, on August 11 announced the divestment of 100% stake in the 3 x 33 MW (99 MW) run of the river hydroelectric power plant owned by its subsidiary L&T Uttaranchal Hydropower (LTUHPL) to Renew Power Services, a wholly owned subsidiary of Renew Power.

This is in line with the declared L&T focus of divesting non-core assets and improving shareholder value. The transaction is subject to completion of customary closing conditions and closing is expected to take place before September 30, 2021. The sale consideration is Rs 9,850 million.

"This development is a significant step in our effort to unlock the value of some of our power development assets to streamline and allocate capital to create long term value for our shareholders," said D K Sen, Whole-time Director, Larsen & Toubro, describing the sale of the asset. "It represents our strategic effort to increase focus on our core strengths and exit others to move towards becoming a more asset-light organization."

Sumant Sinha, Founder, Chairman, and CEO of ReNew Power, said, "Given that the asset is already operational, the acquisition is not only value accretive for us but also presents a lower level of risk. It strengthens our ability to provide firm and round the clock power to the grid and compliments our solar and wind assets, filling up an important position in our portfolio. We will be looking to acquire more hydro assets in future as they are the best clean balancing sources for intermittent renewable energy."

Shares of the company declined Rs 8.85, or 0.56%, to trade at  Rs 1,578.30.  The total volume of shares traded  was  29,650 at the BSE (12.15 p.m., Wednedsay).