Power Finance Corporation Ltd and REC Ltd have sought approval from the Department of Investment and Public Asset Management or DIPAM for a debt resolution plan for KSK Mahanadi Power project, which is currently under the insolvency process.
The state-owned lenders, with NTPC Ltd as the technical partner, had earlier given expression of interest for the 1,800 MW coal-based power project in the Champa district of Chhattisgarh along with companies like Vedanta Ltd, Adani Power Ltd, and Jindal Power Ltd.
While the PFC-REC duo had submitted its bid for the project, it was later clarified that they needed DIPAM’s approval to participate in the resolution process, three people in the know said.
The two non-banking financial companies had given a similar proposal for the stressed Lanco Amarkantak Power project, initially without approval from the department. Later the department accepted it as ‘fait accompli’, two of the people said. The two companies are also a part of the consortium of lenders of the project.
After more clarity on the matter through the experience of the Lanco project, it was stated that even a lenders’ resolution in cases where they are creditors to the distressed asset, will require the department’s approval. Emailed query to Dipam’s secretary Tuhin Kanta Pandey remained unanswered till the time of publishing. PFC and REC did not respond to queries sent by ET.
