GSPC Pipavav Power to raise Rs 450 cr through stake sale

Invites EOI from global companies for sale of minority stake of 49%

GSPC Pipavav Power Company Ltd (GPPC), a subsidiary of state-run Gujarat State Petroleum Corporation Limited (GSPC) is in the process to raise around Rs 450 crore through equity partnership from private players. GPPC has invited expression of interest (EOI) from global companies for sale of minority stake to an extent of 49 per cent in GPPC.

"We have invited EOIs from global players for equity partnership to the tune of 49 per cent. This (equity investment) may be anywhere in the range of Rs 400-450 crore," said a GPPC official.

GPPC has appointed SBI Capital Markets as financial advisor for soliciting equity participation in the company.

 

"First, we will scrutinise the EOIs filed by private entities and then short-list from them. Final decision will be taken by the board of the company in the due course of time," said the official.

"SBI Capital Markets solicits EOI from interested parties for purchase of substantial minority stake to an extent of 49 per cent in GPPC," company stated in its tender document.

GPPC is setting up 702 megawatt (Mw) (2 x 351 Mw) gas-based power project at Kovaya village, District Amreli in Gujarat with an estimated investment of Rs 2900 crore with debt/equity ration of 80:20.

Long term power purchase agreement (PPA) for a period of 20 years has already been signed with state power utility, Gujarat Urja Vikas Nigam Limited (GUVNL). Also, the company has entered into a gas supply agreement (GSA) with GSPC for supply of around 3.2 million standard cubic meter per day (MMSCMD) of gas.

The entire power project is expected to be commissioned by June 2013, while the first unit of 351 Mw is expected to be commissioned by December 2012. So far, over 90 per cent of the physical work has been completed. The plant capacity can be scaled up to 1050 Mw.

Necessary clearances such as consent to establish, environmental clearance, CRZ clearance, sea water drawl clearances, have been obtained for the entire 1050 Mw, the company informed.

GPPC is a special purpose vehicle (SPV) set up by GSPC along with Gujarat Power Corporation Ltd (GPCL) to set up a power project catering to energy requirements in Gujarat. As per the proposed shareholding of the company, GSPC will hold about 34 per cent stake, while GPCL will hold 17 per cent, while 49 per cent will be given to private investors. Also, GPPC has set up 5 Mw photo-voltaic solar power plant at Gujarat Solar Park at Charanka Village in north Gujarat at the cost of Rs 64.41 crore.