Jindal Power, an arm of Jindal Steel and Power, today announced it had raised a Rs 10,057 crore loan for its Tamnar power project in Raigarh, Chhattisgarh.
The company will use the fund to expand its Tamnar project, by adding another 2,400 Mw at an investment of Rs 13,410 crore. The project is to be funded in a debt equity ratio of 3:1. The equity portion, around Rs 3,353 crore, will be sourced from internal accruals.
The company commissioned a 1,000-Mw coal-based power plant at an investment of Rs 4,338 crore here in 2007.
The term loan facility, with a tenure of about 14 years, was tied up through a consortium of 23 banks and financial institutions. State Bank of India is the sole financial advisor and arranger of this deal.
The company said SBI Capital Markets implemented a unique two-tranche financing structure. The transaction is a blend of project finance and conventional debt financing, arriving at an optimal risk allocation structure between Jindal Power and the lenders. This accords more flexibility to Jindal Power for its other borrowing programmes by isolating the project risk. At the same time, the lenders derive comfort from the company’s balance sheet.
Jindal Power has signed an MoU (memorandum of understanding) with the Jharkhand government to set up a 2,640-Mw thermal power plant. The company has signed agreements to set up power projects to the tune of 6,100 Mw in Arunachal Pradesh, in a joint venture with Hydro Power Development Corporation of Arunachal Pradesh.
