New Delhi: To get hold of better deals, state-owned power giant NTPC has chosen to just acquire stressed power projects facing insolvency proceedings in the National Company Law Tribunal (NCLT). With the government seeking to resolve the problems relating to beleaguered assets, India’s largest power utility was previously also keen on acquiring the projects through negotiations with project developers. “NTPC has decided to go slow on an expansion of its capacity addition through acquisition of stressed power assets. The company is now looking at only those projects which would go under hammer as part of the insolvency process,” a source said.
NCLT route will help NTPC get higher discounts
“Now, the company is looking at NCLT route as it would help the NTPC to acquire these projects at higher discounts,” he added. Till now, all insolvency deals in NCLT have received up to 70 percent discounts or even more from secured creditors. The power giant had been planning to expand its power generation capacity by around 6 GW by acquiring brown-field projects. This is because the development of a green-field power plant is time-consuming and takes up a lot of resources.
The Supreme Court had ruled in September that in case of stressed assets going through insolvency proceedings, the status quo would be maintained. Until the matter is under judgement, all projects which were outside the tribunal would not be subject to insolvency proceedings. The case is still pending.