Statkraft in talks to buy Lanco's hydel power unit

New Delhi: Oslo-headquartered Statkraft is in advanced talks to buy Lanco’s under-construction hydel power unit, Lanco Mandakini Hydro Energy, according to multiple people aware of the matter.The Norwegian state-owned company, which is arguably the largest generator of renewable power in Europe is negotiating with a bankers consortium led by Axis Bank to buy the unit. The bankers are looking to recover ₹1,300 crore from the sale, the total debt outstanding in the project, these people said.The unit ran into financial distress after its projects located near the pilgrim town of Kedarnath in north India were washed away by flash floods seven years back. 80224359Lenders continued to provide financial support to resuscitate the company but were unable to get the projects up and running in the absence of funding from its parent, Lanco Infratech.Lanco Infratech has been liquidated after it failed to find a buyer under bankruptcy proceedings. The hydro power unit had appointed the company as its construction contractor. It had paid an advance of Rs 150 crore to its parent for carrying out the construction work, which is now a bad debt.This is Statkraft’s second attempt at acquiring the company. It had conducted detailed studies of the company’s projects three years back but failed to arrive at a deal with its lenders.The Reserve Bank of India provided a special dispensation to the company’s lenders subsequently. This allowed the lenders to restructure its loans. The special dispensation was granted on the grounds that the projects had suffered a natural calamity.Statkraft declined to comment when contacted. Bhrugesh Amin, the NCLT-appointed resolution professional of the company also declined to comment.The unit houses two projects that have the capacity to produce 152 megawatts of hydro power. The projects are located near Kedarnath and are designed to use the Mandakini river’s flow to generate power.

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