SBI to fund Tatas' bid for Singapore co

India’s largest bank, State Bank of India (SBI), will offer Tata Power $1 billion to help it acquire Senoko Power, Singapore’s largest-power utility.In the past, SBI had extended a $1.2 billion loan for the Corus acquisition and about $500 million for financing the buy out of Jaguar and Land Rover( SBI, others to raise $3 bn for Tata Motors
). For the Senoko bid, SBI Capital Market has been appointed as the lead arranger for funds. SBI has agreed to provide a loan for 18-24 months. The loan is pegged 350 basis points over Libor.

Temasek Holdings had put Senoko Power on the block in early August, in a deal which is expected to raise close to $3 billion. Temasek is expected to shortlist bidders in the first week of September after which those shortlisted will be allowed to carry out a due-diligence exercise. The entire sale is expected to be concluded by the end of 2009.

TPC in race for Singapore power co

Investment arm of Government of Singapore,Temasek Holdings has shortlisted Tata Power (TPC) to bid for the city state’s power generating company, Senoko Power.The successful bidder may need to fork out $3 billion to bag Senoko.Tata Power will have to compete with global giants like Japan’s Marubeni and Mitsubishi, France’s GDF Suez, Malaysia’s YTL Power and the OneEnergy-CLP Holdings combine

The sale of Senoko will involve a two-stage process with interested companies initially submitting a non-binding expression of interest. Later, the shortlisted companies will be allowed to conduct due diligence before making their binding offers.

In the last financial year, Senoko Power generated revenues of $2.5 billion and an operating profit of $245 million. Credit Suisse and Morgan Stanley are advising Temasek on the sale of all the three power generating companies.

Read more in The Economic Times artcile.

Tata Power acquires 26 pc in Bhutan hydro project

Tata Power on Monday announced that it has acquired 26 per cent stake in 114 MW hydro-power project and will deliver the generated power at the India-Bhutan border.The company has bought 26 per cent stake in the project, while Tata Power trading has negotiated to purchase all the power generated from the project.

Tata Power has entered into a partnership with the Royal Government of Bhutan through Druk Green Power Corp (DGPC) for developing the said project.The project would be executed by the Special Purpose Vehicle Dagachhu Hydro Power Corp.
However, the financial details and the terms of the partnership were not disclosed.

The power is expected to be evacuated through the Tala Transmission Link into India's Eastern Region Grid.

Tata Power eyes shipping biz

Tata Power plans to foray into shipping. The company will invest $500 million through its Singapore-based special purpose vehicle, TPC Energy Asia, to prepare a fleet of nine vessels to transport coal from Indonesia to its plants located in the western coast of India.The company has already signed charter agreements for three ships.

Analysts said the India-bound freight rates are expected to be firm as companies such as Vedanta, Reliance Power and other ultra mega power projects begin shipment of coal. It is not just the prospect of high rates that is weighing on the minds of power producers, but also the possibility that ships too may not be available.Tata Power may consider commercial use of spare ship capacity later

Reliance Power, which is developing two ultra mega power projects, is reportedly considering a foray into the shipping business to cut the transport cost.

Read more in The Business Standard article.

Tata Power to refinance Indonesian acquisitions

Tata Power Company (TPC) on Tuesday announced refinancing of loans worth $850 million taken for funding its acquisition of 30% stake in Indonesian thermal coal producers, PT Kaltim Prima Coal and PT Arutmin Indonesia, as well as trading companies from PT Bumi Resources. It had taken $950-million one-year bridge loan to finance the $1.1-billion purchase.

The refinancing consists of a $580-million non-recourse loan and a $270-million recourse loan. The non-recourse facility has a door-to-door tenure of six years while the tenure of the recourse loan is one year more.

The financing has been provided by a group of banks led by five mandated lead arrangers including Barclays Capital, Bank of India, ICICI Bank, State Bank of India and Sumitomo Mitsui Banking Corporation. TPC will evaluate the option of refinancing the remaining $100 million of the bridge loan at an appropriate time.

Read more in The Economic Times article.

Tata Power ties up debt for $4.2 bln project

Indian power utility Tata Power Ltd said on Thursday it has signed agreements with a consortium of banks to part fund its upcoming 4,000 megawatt power plant in the Western state of Gujarat. Debt from Indian banks and multilateral agencies would account for three quarters of the project cost, which is estimated at $4.2 billion. Tata Power, part of the diversified Tata group, said in a statement the first of the five power units will be set up in September 2011 and the entire plant would be commissioned by 2012.

The power would be supplied to five states, it said. About $1.8 billion would funded via external commercial borrowings from agencies including the Asian Development Bank (ADB) and the International Finance Corp. Separately, the ADB said in a statement on Thursday it has approved a loan for $450 million for the project. Another 55.5 billion rupees ($1.38 billion) would be rupee denominated loans from Indian financial institutions and the remainder would be equity.

Read more in The Economic Times article.

3 Indian cos bid for Singapore power giant

Three domestic power companies — Reliance Energy, Tata Power and GMR Infrastructure — have submitted indicative bids to acquire Singapore-government owned Tuas Power.

While Tata Power and Reliance Energy have decided to bid on their own, Bangalore-based GMR Infrastructure has formed a consortium with Macquarie Bank and Kuwait Fund for the purpose.The price tag for the foreign asset could be at around $2 billion (Rs 8,000 crore).The domestic power majors submitted their bids today, which was the last date of submission of indicative bids.

Industry sources said other interested parties include Hong Kong's China Light & Power, Hongkong Electric, Japan's Marubeni, Singapore's SembCorp Industries, Tokyo Electric Power Co, Australia's Babcock & Brown, General Electric and International Power Plc of the UK.

Read more in The Business Standard article.

FT, PTC India to launch power exchange

Financial Technologies India and PTC India have received approval from the central electricity regulatory commission to set up India's first national level power exchange, Indian Energy Exchange Ltd for trading electricity.Indian Energy Exchange will be a pan-India neutral and transparent electronic demutualized exchange for efficient price discovery in the electricity market.

PTC India has consented to take 26 per cent stake and corporates like Tata Power, Reliance Energy, Rural Electrification Corporation, Adani Enterprises and IDEC will also hold stake in the consortium. The company will invite strategic partners to join the power exchange.

The power exchange will benefit market participants such as the generators, distribution licensees, open access users, trading licensees, industrial consumers, system operators and bankers in many ways.Currently, short term trading constitutes only 3 per cent of the total energy market as against over 15 per cent globally.

Read more in The Economic Times article.

Tata Power offloads 4.2% in PTC for Rs 50 crore

Tata Power has sold 4.2% in PTC India in the open market for about Rs 50 crore. Tata group’s power generation arm was one of the early investors in PTC, formerly Power Trading Corporation. The partial stake sale comes at a time when PTC has announced it will raise Rs 1,200 crore from the market to fund expansion plans. Existing investors would be required to pump in more money or see their stake come down.

As per the stock exchange disclosures, Tata Power held 10.47% till March 2007. The company diluted its holding marginally during the April-June quarter. Thereafter, it sold an additional 3.35% in the open market over the past six weeks. Last week, Amulya Charan, a Tata Power nominee on the PTC India board had resigned. As per the average market price of TPC share during the time of the sale, Tata Power is expected to have fetched close to Rs 50 crore out of which about Rs 40-42 crore would have been generated in the current quarter.

Tata Power still holds 6.3% equity in PTC, valued at about Rs 70 crore. Tata Power had invested Rs 17.6 crore to acquire the stake in PTC over a period of time.

Just before the initial public offering (IPO) of PTC in March 2004, Tata Power was the single largest stake holder in the company having about 16% stake.Tata Power’s holding came down after the IPO to about 10% and till June 2007 it remained the single largest equity holder.

Tata Power to raise Rs 14000cr to fund Mundra proj

Tata Power Company (TPC), the country's biggest private power utility, will raise up to Rs 14,000 crore in loans to fund the Rs 18,000 crore ultra mega power project at Mundra in coastal Gujarat.

The company has appointed SBI Caps as head arranger for the funds, S Ramakrishnan, the company's executive director (finance), said.The remaining Rs 4,000 crore would be funded by the company through internal resources.

Besides, the company is also in talks with Asian Development Bank (ADB) and International Finance Corporation (IFC) for raising a part of the Rs 14,000 crore.

The Tata group company is also considering the option of having the project part-funded by export credit agencies.

Tata Power gives 10% as pref issues

Indian power utility Tata Power Company Ltd. plans to issue more than 20 million shares and warrants, amounting nearly 10 per cent of its equity, on a preferential basis to its largest shareholder, Tata Sons Ltd.

The issue price of the shares and warrants would be set later, the company said in a statement to the stock exchange late on Tuesday. Shareholders would have to approve the issue plan.Tata Sons, the holding firm of the Tata Group, holds 28.74 per cent in Tata Power as of March 31, stock exchange data showed.

Tata Power's shares closed at Rs 610.65 on Tuesday.

NTPC to foray into wind power

After ONGC, HPCL and Tata Power, the country's biggest electricity generator NTPC Ltd now plans to foray into wind power with an investment of more than Rs 1,200 crore as it seeks to diversify into renewable energy.

The navratna PSU, which has an installed capacity of more than 26,000 MW entirely on coal or gas, has been looking to diversify into other energy sources and is already working on hydroelectric projects, besides a few small biomass plants.

NTPC's proposed venture comes at a time when a number of energy companies in India and abroad have already forayed into renewables, particularly wind and solar. India is the world's fourth largest wind energy producer with an installed capacity of more than 7,000 MW, only behind Germany, Spain and the US.

Read more in The Economic Times article.

Tata Power signs $1 bn deal with Korean firm

Tata Power Company, which is developing India’s first 4,000 mw ultra mega power project (UMPP) in Mundra, today signed contracts reportedly worth $1 billion with Korea’s Doosan Heavy Industries & Construction Company for supply of super-critical boilers and development of ancillary civic structures.

The order, which includes five units of 800 mw each, comes about three weeks after the company formally took over the reins of the project in Gujarat, which is based on imported coal.

While the company has 64-69 months under the contract to commission the first unit, it expects to advance the schedules “ahead of the bid stipulation”. This means that the first unit would be commissioned within the 11th Plan period itself (2007-2012).

Tata Power bagged the Rs 16,000 crore Mundra project against competition from the likes of Sterlite, Adani, Essar, Reliance Energy and L&T by committing to supply power at the the lowest rate of Rs 2.26 a unit (a levelised rate for 25 years).

Read more in The Business Standard article.

Tata Power eyes overseas for JV

Tata Power Company is looking to form a joint venture with an overseas electrical equipment manufacturing company just two days after ensuring coal linkage for its ultra mega power project (UMPP) in Mundra and other projects in Maharashtra through a billion dollar transaction.

Prasad Menon, managing director TPC, told ET that the company is in talks with some potential partners and that a deal will be finalised before June 2007. TPC, the country’s largest private power producer with 2,300 MW, is in talks with Japanese companies such as Hitachi, Mitsubishi and Toshiba, said sources close to the development.

They added that TPC is weighing several options including a possible joint venture manufacturing facility in India as the company plans over 10,000 mega watt (MW) greenfield projects across the country. Mr Menon refused to divulge the name of the company.

Recently, TPC’s tie up with Siemens had broken down because Siemens opted to keep away from the aggressive bid for UMPPs. TPC has tie up with Korea’s Doosan Heavy Industries and Construction Company for super critical boilers.

Read more in The Economic Times article.