PFC seeks buyers for project by KSK energy subsidiary

Led by Power Finance Corporation (PFC), lenders to KSK Mahanadi Power — a thermal power project of KSK Energy Ventures in Chhattisgarh with debt of Rs 18,551 crore — are seeking a buyer for the project, a document inviting bids showed. “SBI Capital Markets Limited has been mandated by Power Finance Corporation (on behalf of the consortium of lenders of the company) to identify a strategic investor to effect change in ownership and management control of a 3,600 MW (6×600 MW) coal based thermal power project using sub-critical technology in the state of Chhattisgarh,” the document said.

According to it, of the total capacity, 1,800 MW (3×600 MW) has been commissioned and is currently operational while another 1,800 MW (3×600 MW) of capacity is under implementation. Attempts by the management of the company to sell the project to possible buyers over a year ago failed to attract any interest. This time around, though, the response may be different as the lenders may be more open to making certain concessions to attract the right suitors.

The company is promoted by KSK Energy Company (4.55% stake), KSK Energy (26.31%) and KSK Power Holdings (4.63%). The company reported a net loss of Rs 88 crore on the back of Rs 20 crore in total income in FY17, primarily owing to an interest outgo of Rs 133 crore. In the three months to December 2017, it reported a net loss of Rs 32 crore on a total income of Rs 5 crore. Apart from seeking investors for the project, lenders also plan to change the management of a subsidiary which is implementing the raw water intake system for the project, and that of an associate developing the railway siding outside the plant boundary.

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