NTPC raises USD 300 mn offshore loan through BASAL

Mumbai, Sep 21 (UNI) The state owned power generating company, NTPC Ltd has borrowed USD 300 million overseas to fund two upcoming generation projects, Bank of America Securities Asia Ltd (BASAL) here today said.

BASAL, a subsidiary of Bank of America, was the sole underwriter and book runner for the offshore loan up to USD225 million, while the balance USD75 million was funded by the Asian Development Bank.

With this, BASAL closed the first loan syndication deal for an Indian corporate under the Asian Development Bank's complementary finance scheme, the underwriter in a statement issued here said.

The loan raised would help fund two projects of NTPC - the Sipat Super Thermal Power Plant in Chhattisgarh state and Kahalgaon Super Thermal Power Plant project in Bihar. These projects would add 4,480 megawatts to the national grid between 2006 and 2009.

T Sankaralingam, Chairman and Managing Director of NTPC, remarked that ''NTPC's capability of raising resources from the international market is well established and the present response bears a testimony to our strength. He further expressed his deep satisfaction with the transaction and stated, ''that strong financials of NTPC coupled with its practice of adhering to stringent environmental standards infused confidence in ADB, resulting in overwhelming response during syndication.'' Kevin Salerno, Regional Head - Asia Pacific, Syndicated Capital Markets for Bank of America added, ''We are very pleased with the strong investor response to this maiden placement under ADB's CFS loan facility. The transaction, not only provides NTPC with access to a large investor base but also serves to extend the average maturity of debt, which is not normally seen in the syndicated loan markets.'' Don Purka, Structured Finance Specialist, Private Sector Operations of ADB said, ''Through recent policy initiatives, ADB is filling a financing gap by lending to state-owned enterprises without sovereign guarantees, provided their standalone credit is healthy and they are directly contributing to economic development of the country. NTPC was a perfect candidate for this pilot financing scheme. Infrastructure development requires long-term lending, which we can provide on our own, but it is also our mandate to bring commercial banks into such transactions.'' UNI SN MJ AG1712