Mumbai, Feb 12: The Maharashtra State Electricity Board (MSEB) will shortly launch a taxable bond issue of around Rs 100 crore, while reconsidering the earlier option of external commercial borrowings. The money will fund MSEB's 30 per cent stake in the Dabhol Power Company (DPC). The board will have the option of retaining oversubscription from the issue which is expected to rake in around Rs 200 crore. MSEB needs around Rs 730 crore for its equity portion in DPC. It had recently raised around Rs 275 crore from its Rs 150 crore tax-free bond issue.Like the tax-free bonds, the taxable bond and ECB issues will also have the guarantee of the state government. The syndicated loan is likely to be for eight to ten years. The ECB will be confined to less than the $50 million, planned initially. According to sources, the international bank, Societe Generale de France has agreed to underwrite the entire issue. The bank had, even earlier, agreed to this arrangement and loan was to have been borrowed at 75-basispoint above Libor, they added.
While launching the taxfree bonds, MSEB had announced that it may not go in for the expensive ECB route. The board had hoped to generate Rs 600 crore by way of oversubscription.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
