Lanco’s Sikkim-based 500 MW Teesta Hydro Power, majority of which is now owned by a consortium of lenders, has attracted three potential buyers that include at least one foreign company...
Lanco’s Sikkim-based 500 MW Teesta Hydro Power, majority of which is now owned by a consortium of lenders, has attracted three potential buyers that include at least one foreign company, chief executive of the group’s power business, K Rajagopal told FE without divulging the details of the companies.
The hydro project, with an estimated cost of over Rs 3,000 crore, has suffered several delays leading to interest payment default by the promoter. The consortium of banks, led by ICICI Bank, converted part of its debt into equity to hold 51% in the project under strategic debt restructuring (SDR) scheme approved by Reserve Bank of India earlier this year.
The total debt for the project stood at nearly Rs 2,200 crore while Lanco’s equity stood at about Rs 700 crore.
“We haven’t decided on our role in the projects once it’s bought over as we will continue to execute the engineering, procurement and construction contract for them,” Rajagopal said. He added that the project would need another 2-3 years to come on stream.
Teesta Hydro would become the second asset to be sold from the Lanco stable after the company divested its 1,200 MW coal-based power plant in Udupi to Adani Power earlier this year. The company, however, said that it intends to complete its much delayed 76 MW hydro project on river Mandakini in Uttarakhand.
On the thermal power front, the firm has now started supplying 300 MW to Haryana after the apex court directed Coal India’s subsidiary to supply coal for its coal-based Amarkantak power plant in Chhatisgarh.
The company has also won a favourable order from UP’s regulatory commission that revised its tariff from 1,200 MW Anpara power plant upward on account of change of coal source. These two developments are likely to boost the firm’s cash flow in the coming days.
The company said that it has resumed construction activities for second phase of 1,320 MW coal-based Amarkantak power plant along with its plants in Vidarbha in Maharshtra and Babandh in Odisha.
Rajagopal said that the company has brought in about 50% of the equity for all the three under construction project and the lenders have allowed it to pump in the rest of the equity at the end of project completion. Each of the project has an equity component of about Rs 2,000 crore.