Banks look to sell 51% in Jindal India Thermal

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Mumbai | Published: August 29, 2017 7:01:29 AM

A consortium of lenders led by Punjab National Bank (PNB) is looking to sell a 51% stake in Jindal India Thermal Power (JITPL) and effect a change in the company's management.

banks, Jindal India Thermal Power,  equity shares of JITPL, Odisha, ICICI Bank, Axis Bank, dena bankThe company has a 1200 MW coal-based thermal power plant, set up in two phases of 600 MW each. (Reuters)

A consortium of lenders led by Punjab National Bank (PNB) is looking to sell a 51% stake in Jindal India Thermal Power (JITPL) and effect a change in the company’s management. The company’s gross debt to lenders stands at Rs 5,902 crore. SBI Capital Markets (SBI Caps) has been mandated to find a buyer.  “The security trustee to the lenders holds 51% equity shares of JITPL on behalf of the lenders and they now propose to sell these shares along with management control,” according to a document seeking investors. Jindal Thermal reported a net loss of `310 crore on the back of `1,207 crore in revenues for the first nine months of FY17 (provisional).

The company has a 1200 MW coal-based thermal power plant, set up in two phases of 600 MW each. It had signed a memorandum of understanding (MoU) with the government of Odisha on September 26, 2006 for development of the project. The project cost for phase-I and phase-II was pegged at Rs 3,476 crore and Rs 3,585 crore, respectively, funded at a debt-to-equity ratio of 75:25. JITPL is a special purpose vehicle (SPV) established in 2001 for development of  coal-based thermal plant, and is a part of BC Jindal Group of companies.  Last year, FE had reported that a consortium of 18 banks agreed to stretch JITPL’s repayment period using Reserve Bank of India’s (RBI) 5/25 norms. Lenders to the company include State Bank of India, Punjab National Bank, United Bank of India, Bank of Baroda, UCO Bank, Indian Bank, Canara Bank, ICICI Bank, Axis Bank and Dena Bank.

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