Rebel Trio Confused On Political Strategy

Engineering and cements conglomerate Larsen & Toubro (L&T) is planning to set up a holding company to manage infrastructure projects, including power, currently executed through separate special purpose vehicles (SPVs).

The holding company will be created with very low initial investment and L&T will invite financial institutions to invest in the company.

In his `Vision 2005', L&T chief executive officer and managing director A M Naik indicated that "for employing the working capital of the company efficiently, it will set up a holding company instead of putting money in each and every SPV for infrastructure and power projects."

The company will henceforth route all the SPVs through the holding entity. The SPVs are expected to be subsidiaries of this holding company.

 

L&T has so far set up several SPVs for the infrastructure projects. Some of its existing SPVs include L&T Transportation Infrastructure Ltd for setting up a 28-km bypass road in Coimbatore along with an additional two-lane bridge across river Noyyal at Athupalam. Another SPV, Narmada Infrastructure Construction Enterprise Ltd, is for a bridge over Narmada at Zadeshwar in Gujarat, while HPL Cogeneration Ltd is for setting up a 116 mw naphtha-fired combined cycle captive power plant for Haldia Petrochemicals Ltd in West Bengal.