DB Power to raise funds for Chhattisgarh plant soon

BANGALORE: DB Power is close to raising Rs 2,625 crore to part-finance its mega power project in Chhattisgarh. The DB Corp subsidiary is developing a 1,200-mw coal-fired mega power plant in the state at an estimated cost of Rs 3,500 crore. It is raising 75% of the project cost as debt. The company hopes to sign the credit deal in the next two weeks, with SBI as the sole debt arranger and syndicator.

“The project has a debt component of 75% and carries an interest of 12% on it,” said a person close to the development, who did not wish to be named. The firm is tying up with eight financial institutions with LIC, Union Bank of India and L&T Infrastructure and Finance among them.

A senior official from DB Power confirmed the development but did not give any details. “The project is at the initial stage and it is not our policy to comment on financial transactions,” he said.

The project, for which land has already been acquired, will be implemented in two phases of 600 mw each. The firm has also received approvals for coal linkage. “We have been allotted a captive coal mine having 100 million tonne reserves by the government of India,” the official said.