PFC defers Sasan transfer to Lanco, Jindals

Power Finance Corporation today deferred the transfer of Sasan Power Company to Lanco Infratech and Jindal Steel & Power.

The board of Sasan Power, which met today in New Delhi, failed to take a decision on transfer of the ownership from Power Finance Corporation to the winning consortium "" Lanco Infratech and Jindal Steel.

Lanco Infratech chairman L Madhusudan Rao said the company had submitted all the documents including a performance bond for Rs 300 crore.

Power Finance Corporation set up Sasan Power to facilitate setting up of the first pit-head ultra mega power project. The project was mired in controversy with Globeleq UK selling its Singapore subsidiary Globeleq Singapore, which was the lead partner for the Sasan project, to Lanco Infratech and Jindal Steel & Power.

The power purchase agreements with the buyer states, which were to be transferred today to the bid winners, have also not been transferred.

Sasan Power CEO Ghosh Dastidar and PFC Chairman V K Garg were not available for comment on the development.

Sources said the PFC Chairman had sought the opinion of the Solicitor General of India on the new management structure of the winning consortium.

Under the bid conditions, while the minority partnership may change hands, the lead partner cannot walk out without forfeiting the bid. Lanco, sought to overcome the hurdle by acquiring the Globeleq Singapore, which had bid as the lead partner.

However, Globeleq Singapore which has a significantly smaller balance sheet than the minimum stipulated turnover of Rs 1000 crore, at $ 80,000, had to be backed up by its UK parent Globeleq UK.

But, with Globeleq UK selling the subsidiary, questions were raised on the validity of the winning bid. It was in this context that the PFC had referred the issue to the Solicitor General of India for a legal opinion.