Further, in accordance with the arrangement with lenders of UEPL, the company has provided corporate guarantee to the lenders of UEPL to assure the due performance and compliance of terms of borrowings by UEPL. The borrowings include a Rupee term loan facility for an aggregate principal amount not exceeding Rs 543 crore and a working capital facility for an aggregate principal amount not exceeding Rs 23 crore.

Prior to the acquisition, Ashoka Buildcon (ABL) and an investment fund managed by Morgan Stanley India Infrastructure (MSII) held equity in UEPL.

The acquisition was completed on 1 February 2024, subsequent to the receipt of approval from Petroleum and Natural Gas Regulatory Board (PNGRB) on 13 December 2023.

UEPL has been granted authorisation by the PNGRB to develop a city gas distribution business in Ratnagiri, Latur and Osmanabad in Maharashtra, and Chitradurga and Davangere in Karnataka. It is engaged in supplying natural gas to the domestic, commercial, industrial and transport sectors.

Ashu Shinghal, managing director, Mahanagar Gas, said: "Unison Enviro is our first acquisition. It is a momentous occasion for MGL, marking a significant milestone in our corporate history. The acquisition of UEPL aligns with our commitment towards realising our long-term growth plans.

It will not only help expand our core business of city gas distribution but will also help UEPL in ensuring a higher growth trajectory by leveraging deep domain knowledge, optimisation of cost structure through possible integration and synergies.”

In addition to this acquisition, MGL has further diversified its energy portfolio with the establishment of Mahanagar LNG. MGL is also working with Brihanmumbai Municipal Corporation (BMC) to set up one of the largest biogas plants based on Municipal Solid Waste in Mumbai.

"Hydrogen, EV, renewables are adjacent areas for MGL to expand its energy portfolio for which the company is actively engaged in exploring opportunities to fuel its growth,” the company said in a statement.

Mahanagar Gas has established a firm presence in the Greater Mumbai gas distribution business, where it is the dominant player. Its growth is primarily driven by the CNG business, which contributes 70-75% of its revenues at present. The company also supplies piped natural gas (PNG) to industrial, commercial, and residential segments. The company sources most of its gas requirements from GAIL, while a small part is bought from the spot market.

The company reported 84% jump in net profit to Rs 317.18 crore in Q3 FY24 from Rs 172.07 crore in Q3 FY23. Net revenue from operations declined by 6% year-over-year (YoY) to Rs 1,568.76 crore during the period under review.