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.
“The company is looking at more coal mines in Australia and South Africa, where low sulphur and low ash coal is available. Through the acquisition of 30% stake in PT Bumi Resources Tbk's coal mines PT Kaltim Prima Coal and PT Arutmin Indonesia, the company has ensured 50-60% of the requirement of 2011 as the company needs 21MT of im-ported coal for the upcoming projects.
For the remaining coal, we are looking at various countries,” said Mr Menon. TPC has already applied to the coal ministry for allocation of six coal blocks for captive mining. The company will also planning to procure coal from the spot market.
TPC is planning to raise 50-70% of the Indonesian acquisition cost of $1.1 billion, prior to working capital and other adjustments, in foreign debt. The remaining will be raised through internal accruals.
The debt will be raised through the offshore special purpose vehicle (SPV), launched for acquiring the stake in Bumi Resource’ two coal mines and a related trading company. The transaction will be completed by June 30, 2007. Macquarie was the financial adviser to TPC for the deal.
The coal from Bumi will be used for the proposed 4,000 MW UMPP in Mundra and the 3,000 MW projects in Ma-harashtra. The two companies of Bumi have a production capacity of 55 million tonne per annum (MTPA) and almost 95% of it has been exported to Japan, China, Korea and India.
They are increasing production by another 20-25 MTPA in the next five years. The companies have a major advantage of shipping facilities. On Monday, TPC’s share slipped by 2.62% to Rs 496.10 on BSE as ratings agency Moody's Investor Service said that it continued to review for possible downgrade Tata Power's Ba1corporate family rating and Ba2 senior unsecured debt rating.
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.
“The company is looking at more coal mines in Australia and South Africa, where low sulphur and low ash coal is available. Through the acquisition of 30% stake in PT Bumi Resources Tbk's coal mines PT Kaltim Prima Coal and PT Arutmin Indonesia, the company has ensured 50-60% of the requirement of 2011 as the company needs 21MT of im-ported coal for the upcoming projects.
For the remaining coal, we are looking at various countries,” said Mr Menon. TPC has already applied to the coal ministry for allocation of six coal blocks for captive mining. The company will also planning to procure coal from the spot market.
TPC is planning to raise 50-70% of the Indonesian acquisition cost of $1.1 billion, prior to working capital and other adjustments, in foreign debt. The remaining will be raised through internal accruals.
The debt will be raised through the offshore special purpose vehicle (SPV), launched for acquiring the stake in Bumi Resource’ two coal mines and a related trading company. The transaction will be completed by June 30, 2007. Macquarie was the financial adviser to TPC for the deal.
The coal from Bumi will be used for the proposed 4,000 MW UMPP in Mundra and the 3,000 MW projects in Ma-harashtra. The two companies of Bumi have a production capacity of 55 million tonne per annum (MTPA) and almost 95% of it has been exported to Japan, China, Korea and India.
They are increasing production by another 20-25 MTPA in the next five years. The companies have a major advantage of shipping facilities. On Monday, TPC’s share slipped by 2.62% to Rs 496.10 on BSE as ratings agency Moody's Investor Service said that it continued to review for possible downgrade Tata Power's Ba1corporate family rating and Ba2 senior unsecured debt rating.
