The deal is being arranged by ABN Amro Bank, ANZ Investment Bank, Citibank and Credit Suisse First Boston (CSFB).

ABN Amro, BA Asia and CSFB were originally leading the deal, but BA Asia was forced to opt out of its arranging role following its merger with Nationsbank. Subsequently, ANZ Investment Bank and Citibank joined the deal as equal status arrangers.

Funding will be provided on a 70:30 debt-equity basis, with project sponsor Enron Corp picking up 80 per cent of the equity and co-sponsors Bechtel and General Electric Co 10 per cent each.

The Maharashtra State Electricity Board has an option to buy 30 per cent of the equity which if exercised would mean that Enron's stake would be reduced to 50 per cent.

Aside from the syndicated debt, the remainder of the funding is expectedto come from various sources including financial institutions, loans from Japan's Export Import Bank (J-EXIM) and its Ministry of Trade & Industry (MITI), and Belgium's export credit agency, OND.

The project has had a chequered history and was nearly scrapped in 1995 when the Maharashtra state government decided that the terms of the deal were too favourable to the project sponsors.

Fearing the state government's decision would put off other foreign investors, the union government quickly revived the project.