The Maharashtra Electricity Regulatory Commission (MERC) has approved the proposed 100 per cent stake sale of Reliance Infrastructure's (RInfra's) integrated Mumbai powerbusiness to AdaniTransmission (ATL), an official said on Thursday.

Following the MERC's clearance, the transaction, with a consideration value estimated at Rs 18,800 crore, is expected to be closed in July.

The development comes after MERC concluded its hearing into the matter and reserved its order on June 14.

RInfra, has already received the approval of the Competition Commission of India (CCI) and its shareholders for the deal.

In December 2017, RInfra and ATL had signed a Definitive Binding Agreement for 100 per cent stake sale of the integrated business of generation, transmission and distribution of power for Mumbai.

RInfra will utilise the proceeds of this transformative transaction entirely to reduce its debt, becoming debt free, with up to Rs 3,000 crore cash surplus, in what is the largest ever debt-reducing exercise by any Indian corporate.

This monetisation is a major step in RInfra's deleveraging strategy for future growth, said the official.

The RInfra's Mumbai power business (known as Reliance Energy) is India's largest private sector integrated power utility distributing power to nearly 3 million residential, industrial and commercial consumers in the suburbs of Mumbai, covering an area of 400 sq km.

It caters to a peak demand of over 1,800 Mw, with annual revenues of Rs 7,500 crore with stable cash flows