Financial Closure for 80MW Chennai IV

RNS Number : 0490K

OPG Power Ventures plc

15 August 2012

 



15 August 2012

OPG Power Ventures plc

("OPG" or the "Company")

Financial closure for 80MW Chennai IV achieved

OPG Power Ventures announces the financial closure of its 80 MW Chennai IV power project.  As announced on 19 July 2011, the equity component of the funding for this project is from internal cash generation. The newly arranged debt of InRs322 Crores (approximately £37 million) is denominated in local currency and is to be provided by a syndicate of Indian lending banks, many of which are amongst the Group's existing lenders.  The project is funded in a 3:1 debt to equity ratio. As is normal under the arrangement, interest is payable at a variable rate and the debt is repayable over a total period of 12 years including the initial construction and moratorium period. The debt is backed by a personal guarantee from Mr Arvind Gupta, Managing Director. 

The 80 MW Chennai IV is a replica of Chennai I and II, and shares the same site and certain infrastructure with those units. The project has all the necessary approvals, Indian coal linkages, land, financing and, being already under construction, is estimated to be approximately 65% complete based on the Company's internal measurement basis and project milestones.  The project is currently ahead of schedule and expected to commission by June 2013, taking operating capacity to 270 MW across five operating units.  Current aggregate operating capacity is 113 MW with a further 77 MW (Chennai II) expected to be commissioned shortly. 

As Chennai IV is to be commissioned ahead of the larger 160 MW project at the same site and currently under development, the 80 MW project is now to be renamed Chennai III with the larger project henceforth referred to as Chennai IV.

Managing Director Arvind Gupta commented, "This new facility demonstrates the merits of our model at a time when many other projects around the country are being deferred or facing financing difficulties.  With the equity for this project being generated internally principally by Chennai I, I expect this project to enhance returns to our investors.  The Group now has all its required debt and equity for the 730 MW of assets we're currently building to service the needs of our customers and create value for our shareholders."

For further information, please visit www.opgpower.com or contact:

OPG Power Ventures plc	[phone]
Arvind Gupta (Managing Director)
V. Narayan Swami (Finance Director)
Cenkos Securities (Nominated Adviser & Broker)	[phone]
Stephen Keys/ Camilla Hume
Tavistock Communications	[phone]
Simon Hudson
Kelsey Traynor

About OPG

OPG is operating and developing power projects in India under the group captive model with 113 MW in operations and a further 629 MW under development. In the year to 31 March 2012, the Group's revenues were £45.25m and profit before tax was £2.26m.

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