The ABB Group, 50 per cent owner in ST-CMS Electric Co, one of the original fast-track power projects, has rejected Tata Power's bid to buy it out. ST-CMS Electric runs a 250 mw, lignite-based power project at Neyveli in Tamil Nadu.
This is the second time in the past two months that Tata Power's acquisition bid has been rejected.
The company had submitted a conditional bid for the ABB Group's stake about two months ago. It was also keen on buying out the United States-based company CMS Energy, which holds the balance 50 per cent stake in ST-CMS Electric.
"ABB refused to sell its stake to the Tata Group, and even CMS is not showing any urgency to sell," a source close to the development said. The reason for the rejection of the bid was not specified.
Last year the ABB Group announced its plans to exit various power generation projects around the world.
Thomas Schmidt, spokes-man for the Switzerland-based ABB Group, refused to comment on the issue of the Tata bid.
"ABB's strategy remains unchanged. We are committed to divest our non-core activities, including our equity stakes in the former financial services division. As a matter of principle, we cannot comment on the status of the divestment of any specific project during the process, since all discussions between us and potential buyers are confidential," Schmidt said in an e-mail response to Business Standard.
Around two months ago, the US-based transnational AES Transpower also refused to sell its 49 per cent stake in the Orissa Power Generation Corporation after wide-ranging discussions and the submission of a bid by the Tatas.
The ABB Group has been globally setting its house in order by exiting the non-core activities. Earlier it sold its structured finance business to the GE Group.
CMS Energy has also announced its plans to exit India, citing the lack of clarity in the country's power policy.
