Powergen To Invest Rs 300 Cr In Indian Equity

PowerGen has decided on a fresh investment of Rs 300 crore as equity in India. Its Indian arm, PowerGen India, has submitted a proposal in this regard to the Foreign Investment Promotion Board on May 24.

The fund will be used to retire the Rs 230 crore high-cost ICICI debt which was taken at the time of buying out the Torrent group from the Paguthan power project in Gujarat.

When contacted, PowerGen officials, however, refused to comment on the proposal submitted to FIPB.

But the company has confirmed its commitment to the Bina and Rosa joint venture projects with the A V Birla group despite its plans to divest in several projects the world over to raise funds for its latest takeover of the US-based LG&E Energy Corp.

 

Gerry Gove-White, PowerGen India's country general manager, said, "We are committed to our partners. And so, it is business as usual."

Earlier, PowerGen struck a joint venture deal with the A V Birla group for setting up the two 578 mw power projects at an estimated cost of Rs 2,400 crore.

Among the company's other commitments is a 74 per cent stake in the over 1,000 mw Spic-promoted Tuticurin project.

It also plans to double the capacity at Paguthan to 1,300 mw. For this, it will sign a fresh power purchase agreement. It expects to produce at Rs 3.5 crore per mw against the industry norm of Rs 4.

The company has also initiated talks with various LNG suppliers for meeting its fuel requirements.