 "PFC to file insolvency plea against RattanIndia plant by end of year: Report")
State-run Power Finance Corporation (PFC) is planning to file an insolvency plea against RattanIndia’s Nashik power plant by the end of the year. Two people who are aware of the development told Mint that Nashik is the last major project where PFC is the lead financier and the plant needs to be taken for insolvency.
The plant has a debt of Rs 8000 crore. PFC, who is a lead financier in the project, has an exposure of around Rs 3000 crore. According to one of the officials, PFC was in talks with the Maharashtra government to take over the stressed project of Nashik power plant, but the state government didn’t show any interest.
RattanIndia’s Nashik power plant is situated near Sinnar, which is 40 km from Nashik city in Maharashtra. It has a 1,350 MW installed capacity, with coal linkages from Coal India Ltd (CIL) subsidiaries.
The move comes on the heels of PFC’s resolution of the 600 MW thermal power project of Jhabua Power Ltd in Madhya Pradesh’s Seoni district. The project was resolved via the Corporate Insolvency Resolution Process (CIRP) mechanism, with ownership being transferred to a consortium of NTPC Ltd, REC Ltd PFC, and other lenders.
Other projects under CIRP include the 3,600 MW KSK Mahanadi Power project and the 1,920MW Lanco Amarkantak Power project. While bidders have shown interest in Lanco Amarkantak, the committee of creditors (CoC) are yet to choose the winning bid.
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View AllAs for PFC, it successfully resolved India’s largest stressed asset in the power transmission sector, the South East UP Power Transmission Company Ltd last month.
The transaction had a one-time upfront settlement amount of Rs 3,251 crore as well as a payout of part of the existing cash balance.
On 12 August, 2022, the board of PFC approved the creation of Power Asset Management Co. (PAMC) for taking over stressed power assets. PAMC is going to be a 50:50 joint venture between PFC and REC Limited. The REC board also approved the offer for subscribing to 50 percent equity in PAMC on 5 August.
PAMC will be a professional organisation with expertise to acquire stressed power assets and maintain, operate, and complete them.
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