Srei unit buys 57% in Dishergarh for Rs 172 crore

India Power Corp Ltd (IPCL), a consortium promoted by Srei Infrastructure Finance and Bhaskar Silicon Pvt Ltd, has bought 57.17% stake in Andrew Yule group firm Dishergarh Power Supply Company (DPSC) for Rs 172 crore.

“IPCL emerged as the highest bidder by quoting Rs 710 a share,” Kallol Dutta, chairman and managing director, Andrew Yule said. DPSC unit Descon emerged as the second-highest bidder, Dutta said, with CESC Ltd coming in third.

Of the 57% on sale in DPSC, Andrew Yule held around 15% while the rest was held by Life Insurance Corporation (30.61%) and United India Assurance (11.36%). “Out of the Rs 172 crore mopped up through the stake sale, around Rs 40 crore comes into Andrew Yule’s kitty,” Datta said.

As per regulatory norms, IPCL will have to go for an open offer for an additional 20% stake in DPSC, Dutta added. A top IPCL official told DNA Money that the company will consider setting up a new 500 mw plant at Dishergarh, near the coal belt of Asansol in West Bengal.

“DPSC had plans to set up a 500 mw plant at its excess land near the Dishergarh plant. We will have to see whether this will be a workable option,” the top official said.
DPSC’ generation capacity is 30 mw at present.

The official further said DPSC’s distribution network will also be spruced up from 120 mw now to at least 300 mw over the next two years. IPCL will also aim to double DPSC’s turnover of Rs 250 crore in the period, the official said.

The DPSC sell-off had its share of controversies when Descon, which holds a majority 32.21% in the company, had moved the Calcutta High Court after the Company Law Board allowed Descon’s participation in the biding process along with the highest bidder only if the difference between its bid and that of the highest bidder was not more than 10%. The court removed the rider a few days back.

Sources said that Descon, being familiar with DPSC, had wanted to get the first right of refusal and also a discount on the price. IPCL is investing over Rs 10,000 crore in various power projects across the country. It has signed deals with the state governments of Gujarat and Bihar for a 1,320 mw and a 1,650 mw power plant, respectively. It is also setting up a 400 mw power plant at Haldia.