IFC to invest $15m equity, $40m debt in Techno Electric arm

International Finance Corporation (IFC), the private lending arm of World Bank, will invest USD 15 million (approx Rs 68 crore) in Simran Power Projects Ltd, a 100% owned subsidiary of Techno Electric & Engineering Company Limited, which is developing two wind farms with an aggregate capacity of 127MW in the first phase.

VCCircle wrote early this week that IFC may look at investing in Simran Power.

IFC is looking at lending of USD 40million (approx Rs 180 crore) for the completion of the first phase of the project, Pradeep Kumar Lohia, President, Finance of Techno Electric told VCCircle. IFC's holding, following the equity investment, in Simran Power is not yet finalised, he added.

The first phase of the project, with an estimated capacity of 200MW, will require an investment of Rs 720 crore. The second phase will include an additional capacity of 75 MW expected to be commissioned next year.

The total investment is estimated at Rs 1,150 crore. Of that, the company will infuse Rs 400 crore as equity and the rest Rs 750 crore will be debt. The company is in talks with a few foreign banks to raise the debt. The company is not looking at raising PE funding at this point of time, Lohia said.

Simran Power is developing two wind farm projects with 75.90 MW capacity and 51.00 MW capacity aggregating 126.90 MW located in Tirunelveli and Tiruppur districts in Tamil Nadu. The project will be operated and maintained by Suzlon under an O&M contract with Simran.

Kolkata-based Techno Electric is a power sector engineering, procurement and construction (EPC) company for the last three decades and has recently started investing in wind power projects, already having 95.45 MW of operating wind power assets in Karnataka and Tamil Nadu.

By: Madhav Chanchani