Gautam Adani-led Adani Power Ltd has agreed to buy the thermal power assets of DB Power Limited (DBPL) for nearly Rs Rs 7,017 crore enterprise valuation, the company announced on Friday.

Both sides signed an agreement for the all cash deal on Friday afternoon. The initial term of the MOU shall be till completion of the acquisition on October 31, 2022, which may be extended by mutual agreement.

DB Power has 2 units of 600 MW each of thermal power in Janjgir-Champa district, Chattisgarh.

In its regulatory filing, Adani Power said, "The acquisition will help the company to expand its offerings and operations in the thermal power sector in the state of Chhattisgarh."

The proposed transaction is subject to receipt of approval from the Competition Commission of India and any other approvals as may be identified following the due diligence exercise to be conducted with respect to DPPL and DB Power, it added.

Adani Power will hold 100 per cent of the total issued, subscribed, and paid-up equity share capital and preference share capital of DPPL. While DPPL will hold 100 per cent of DB Power on the closing date of the transaction.

Diligent Power (DPPL) is the holding company of DB Power.

Currently, DB Power has long and medium-term Power Purchase Agreements for 923.5 MW of its capacity, backed by Fuel Supply Agreements with Coal India, and has been operating its facilities profitably.

DB Power was incorporated on October 12, 2006, within the jurisdiction of the Registrar of Companies, Gwalior.

The turnover of DB Power during last three financial years was Rs 3,488 crore (for FY 2021-22); Rs 2,930 crore (for FY 2020-21) and Rs 3,126 crore (for FY 2019-20).