NTPC to take 44.6% in Kerala firm

NTPC, the country's largest power generator, has taken its first step in the manufacturing business through an acquisition. The company will be buying 44.6 per cent stake in Transformers and Electricals Kerala (TELK), a Kerala government company, which manufactures and repairs transformers.

The state government and its undertakings currently hold 95.6 per cent equity of TELK.

The value of the deal was not immediately disclosed. "It has not been finalised...," said a senior NTPC official.

The final numbers will be known once the current memorandum of understanding is converted into an agreement.

While agency reports said that NTPC would pump in Rs 190 crore over the next two years for upgradation and modernisation, the official said that "all that has been decided is that any funding requirement will be met through a 65:35 debt-equity ratio."

TELK has over 40 years of experience in "manufacture, marketing and servicing of power transformers, current voltage transformers, circuit breakers, isolated phase bus ducts, shunt reactors etc and the deal will help make the company an integrated power major," said a release from the company.

The upgradation plan at TELK shall be implemented in a phased manner initially, to achieve a transformer manufacturing capacity of 4,500 mega volt ampere (MVA).

Later, the manufacturing capacity will be raised to 10,000 MVA, with 1,500 MVA of service capability, about 20 high capacity transformers and for manufacturing , repairing 6-7 transformers per year.