Tata Power raises Rs 3,115cr debt for Maithon

Country's top private power producer Tata Power has tied up with State Bank of India and other banks for securing Rs 3,115 crore debt to develop a 1,050 mw coal- based power project in Jharkhand.

The 1,050-mw Maithon Right Bank Thermal Power Project is being set up by Tata Power in joint venture with Damodar Valley Corp. Tata Power owns a 74 per cent stake in Maithon Power, while 26 per cent is held by DVC.

LET THERE BE LIGHT

The joint venture with Damodar Valley Corp, estimated to cost Rs 4,450 crore, has a debt-equity ratio of 70:30

The 1,050 mw coal-based power project in Jharkhand is expected to be commissioned by October 2010

India is setting up greenfield power projects of over 1,000 mw under the public-private partnership

The total fund requirement for the power sector has been pegged at Rs 10,00,000 crore during the 11th Plan

The project, estimated to cost Rs 4,450 crore, is being funded in a debt-equity ratio of 70:30.

"The debt for the project is Rs 3,115 crore and is being financed by various banks, led by State Bank of India (SBI)," Tata Power said.

The company said the consortium of 17 banks, led by SBI include Allahabad Bank, Bank of Baroda, Canara Bank, J&K Bank, Oriental Bank of Commerce and Punjab & Sind Bank. SBI Capital Markets is the sole financial advisor and arranger of debt for the project.

Tata Power Managing Director Prasad R Menon said: "The closure of financing for Maithon project is an important milestone. The unique terms of debt financing provides us more flexibility in the execution of the project as well as help in controlling costs."

The first unit is expected to be commissioned by October 2010, and the second by March 2011. The long-term coal linkage has been allotted from the nearby Bharat Coking Coal mines.