GMR Infra drops Homeland acquisition plans

GMR Infrastructure Ltd has dropped its plan to acquire a 50 per cent stake in South African firm Homeland Mining Energy. The company had already invested up a 10 per cent stake in the South African company at a cost of $30 million. According to A. Subba Rao, Chief Financial Officer, GMR Infrastructure, the company was weighing the exit options, which envisages either taking an equity stake in the holding company of Homeland Mining Energy or taking the cash back for its initial 10 per cent investment. While declining to give reasons for withdrawing from the acquisition, which was reportedly estimated at $155 million, Rao said there were certain issues that prompted the company to withdraw from going ahead with the purchase of the stake. GMR Infrastructure is reported to have renegotiated the price with Homeland, but decided to back out. Only recently the company had successfully renegotiated the acquisition cost of a 50 per cent stake in the Netherlands-based Intergen by obtaining a reduction in price from $1.1 billion to $954 million. The company has been eyeing acquisitions to meet the coal supply for its greenfield power projects coming up in Orissa and Chhattisgarh.