Until recently BPC and Wartsila both held 40 per cent stake each in the Rs 130-crore equity of the project with the balance 20 per cent to be held equally by Finfund and Wartsila Development Fund.

According to BPC general manager (finance) S Nagarajan, Wartsila will hold 60 per cent stake in the project now. Apart from its earlier contribution of 40 per cent, Wartsila has also decided to acquire the balance 20 per cent originally earmarked for the two other Finland-based financial institutions. The 60 per cent stake thus gives Wartsila full control of the project. Wartsila is already the engineering, procurement and construction (EPC) and operation and maintenance (O&M) contractor for the Samayanallur project.

Meanwhile, Nagarajan told The Financial Express that the entire debtportion of Rs 280 crore has been tied up, including a foreign currency loan of $60 million. BPC was, sometime back, struggling to get a bank guarantee for an $11 million foreign line of credit which was claimed then to be the only balance portion of foreign loans remaining to be tied up.

The company has got approvals for the full $60 million foreign loans from a consortium of Indian banks including ICICI, IDBI and Bank of Baroda and Power Finance Corporation which has underwritten $20 million as its part for the foreign line of credit. Indian Overseas Bank has agreed to provide a term loan of Rs 38.3 crore for the project.

Now that the debt component for the project has been fully tied up, financial closure is expected to be achieved by June this year. BPC has already got escrow cover for the Samayanallur project from TNEB which has earmarked 55 collection centres, receivables from which will be put into an identified bank branch for payments against bills raised if there is a payment default for powersupplied.

The Samayanallur project has fuel linkage from Indian Oil Corporation which will supply 1.33 lakh tonnes of low sulphur furnace oil per annum. The project is to be officially flagged off with a ground-breaking and foundation-stone laying ceremony on March 29 at Madurai.