Take-out financing refers to shift of loan liability from one lending agency to another in order to receive better financial benefits. The activity primarily relates to loans concerning ongoing projects with long-gestation periods.

However, the corporation's entry into this field will be restricted to infrastructure projects involving housing, urban development and power sector and is expected to rewrite the rules for core sector project financing in the country.

``The new venture is an attempt towards reorientation of its activities and giving it a much broader perspective and give a new look to the corporation from merely as a lending agency,'' finance director S Sundreshan told The Financial Express.

With this, the public sectorundertaking will enter the new segments of the financial market hitherto patronised by the financial institutions, he added. For the new arrangement, the corporation is negotiating with Canara Bank. The deal with Vijaya Bank is almost final. The tenure for the loans will be for a period of five years.

Each financial agency will charge a commission of 1 per cent on transfer of liability. The first deal in the field is for Dubri power project in Orissa.

This will be done by providing loan to the promoters of Kalinga Power Corporation which is setting up a 500-mw coal-fired power plant at Dubri in Orissa.