Mumbai, May 10: The Maharashtra State Electricity Board has deferred its plan for raising Rs 600 crore to pick up 30 per cent equity in the second phase of Dabhol Power Company. MSEB's decision has come immediately after the state government cleared its proposal for raising bonds issue to pick up 30 per cent stake in the second phase. The state government has cleared MSEB's proposal just two days ago. MSEB sources told The Financial Express that the decision of deferring the bond issue has been taken as the situation is not ripe and it is not sure of getting favourable response from the investors in the volatile markets.Following the MSEB decision, Enron's holding in DPC has gone up to 64 per cent from 50 per cent while GE and Bechtel hold 10 per cent each as of March 2000.
MSEB has yet to officially convey to the DPC of its decision on picking up 30 per cent equity in the second phase. However, sources said that "with mutual consent", MSEB will give proceeds of the proposed bond issue as a loan to its special purpose vehicle Maharashtra Power Development Corporation (MPDC) for the purchase 30 per cent equity from the Enron. MSEB is aware that by holding 30 per cent stake in the second phase, the total tariff will come down heavily as compared to the phase-I.
The total foreign debt for phase-II of the project is pegged at $1,082.4 million taking the debt-equity ratio of 70:30. The foreign debt portion was raised mainly from the Exim Bank of Japan and MITI. Enron has also managed to procure about $90.8 million from OND of Belgium. It raised about $557 million in commercial loans from ABN Amro, Citibank, Bank of America and ANZ Grindlays.
During the first phase, MSEB had paid Rs 730 crore for a 30 per cent stake and bought into the $1.1 billion power project via MPDC.
Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.