(Adds details on deal, Lanco debt background)
MUMBAI, Aug 13 (Reuters) - India's Lanco Infratech Ltd said it has sold a 1,200-megawatt (MW) thermal power plant in the southern state of Karnataka to Adani Power Ltd for about 20 billion rupees ($327 million), as the company looks to cut debt.
Adani Power, part of the Adani business conglomerate led by billionaire Gautam Adani, will take on the plant's existing debt of about 40 billion rupees as part of the deal, Lanco said in a statement late on Wednesday.
Lanco, which produces power, builds roads and constructs residential and commercial buildings, in July last year started a process to restructure its $1.3 billion debt after economic weakness hurt some of its core businesses.
It had a net debt of about 360 billion rupees ($5.9 billion) at the end of March this year, according to the company website.
The coal-based power plant in Udupi has two units of 600 MW each and imports about 4 million tonnes of coal per year from Indonesia, according to Lanco's website.
1 US$= 61.2150 Indian rupees Reporting by Aman Shah in Mumbai; Editing by David Clarke, Sumeet Chatterjee and Dale Hudson