Sources revealed that Dresdner has been selected ahead of Commerzbank and Banque Paribas to arrange the foreign loan for its project.

Whereas BHF will be the lead arranger, Dresdner along with ANZ Grindlays, the financial advisor to the project, will be the co-lead arrangers of this foreign debt.

The total foreign debt for the project stands at $ 313 million, out of which the multilateral lending agency, KfW has agreed to forward $ 106 million loan. The balance amount of $ 207 million will be arranged by BHF, Dresdner and ANZ Grindlays.

Hermes of Germany has given its in-principle approval for providing guarantee of foreign loans to the tune of $ 274 million and based on this guarantee, KfW will forward $ 106 million.

RPG, which is moving towards achieving financial closure for its Dholpur project hasalready tied up for a majority portion of the rupee debt.

Leading Indian banks and financial institutions have provided term loans and deferred payment guarantees to international agencies like the Hermes and KfW. These guarantees are being used as an assurance for raising foreign currency loans.

Industrial Credit and Investment Corporation of India (ICICI) has agreed to forward Rs 600 crore with Rs 100 crore as term loans and the balance Rs 500 crore in the form of guarantee. Industrial Development Bank of India (IDBI) and the Industrial Finance Corporation of India (IFCI) have agreed to sanction Rs 200 crore each.

Other domestic lenders to the project are the Power Finance Corporation (PFC) which has agreed to give Rs 300 crore, State Bank of India Rs 152 crore and Rs 75 crore has been tied up with the Central Bank of India.

RPG will hold 35 per cent equity in this project and the EPC contractor for the project, Siemens AG has been given 15.1 per cent equity in the project.

The company is in theprocess of finalising the operations and maintenance (O&M) contract for the project following which it will float a separate O&M company.

CEPA Power is close to finalising a deal with RPG on picking up a 20 per cent equity in the project and is expected to pitch in as the O&M contractor for the project.

A final decision to this effect is yet to be taken by RPG. The balance equity of 29.9 per cent will be offloaded to a group of foreign investors and the associated companies of the RPG group.