Madhucon Projects Ltd is seeking to raise about Rs 600-700 crore by divesting up to 26 per cent stake in Simhapuri Energy, a subsidiary of the company.
The Hyderabad-based infrastructure, which is implementing the 1,920 MW Simhapuri coal fired power plant in the costal district of Nellore in Andhra Pradesh, is set to complete the commissioning of both phase I and II of 300 MW each by the end of this year.
The Founder-Chairman of Madhucon Projects, Mr Nama Nageswara Rao, said, “Several strategic investors are in talks with the company for possible stake buy out as the project will have a capacity of about 600 MW by the year end.
“Thereafter, we will take up 1,320 MW expansion project.”
This is an attractive project, which has potential to be expanded to 1,920 MW. “Therefore, they are keen to take part in the company growth plans.
“Investors from Oman and the United Kingdom have approached us. However, this is still at discussion stage,” he said.
Financial closure
The Director-Finance Madhucon, Mr. S. Vaikuntanathan, told Business Line it depends on the valuations for the power project and the quantum of funds.
The process is now under way. The stake divestment would infuse funds necessary to achieve financial closure for the 1,320 MW phase III power plant.
“We expect to achieve financial closure before the end of the current financial year. By then, both the phases of 300 MW each would be operational.
“The project is based on imported coal and 70 per cent of the power generated will be supplied to PTC India and the rest sold as merchant power,” he said.
The company shares closed the day's trade down 6.65 per cent to end at Rs 43.55.