Nalco to raise $250 million by August

Nalco to raise $250 million by August
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First Published: Sun, Jul 08 2007. 05 12 PM IST
Updated: Sun, Jul 08 2007. 05 12 PM IST
Mumbai: State-run aluminium producer, Nalco, will tap the overseas market to raise $250-million by August-end for its ambitious capacity expansion plan.
About 17 banks and merchant bankers including SBI, ICICI and Citi have responded to Nalco’s expression of interest to raise over $250 million through the external commercial borrowings (ECB) route, a senior company official told PTI here.
Nalco is undertaking a major expansion, including ramping up of its alumina capacity at the cost of Rs5,040 crore.
ABN Amro, HSBC Bank, Standard Chartered Bank and UTI are among the bidders. Nalco expects to receive bids in the range of 65-90 basis points above Libor.
“The information supplied with the EoI are under scrutiny and a short-list would be finalised by the end of next week. Thereafter, the short-listed banks/merchant bankers would be invited to submit competitive financial quotes,” the official said.
The final decision would be taken on receipt of competitive qoutes by end-August, he said.
In between, Nalco has placed orders on foreign equipment suppliers for its expansion project and the deliveries are due in 2008.
The project involves expansion of capacity of its bauxite mine, alumina refinery, captive power plant and aluminium smelter by about 33%, he said.
Under the expansion, the capacity of bauxite mine in Koraput district of Orissa would be increased from 4.8 million MT a year to 6.3 million MT.
The alumina capacity would go up to 2.1 million MT annually from the present 1.58 million MT, he said. Besides, the capacity at the captive power plant at Angul in Orissa would be ramped up to 1,200MW, he added.
The PSU also plans to enhance its aluminium smelting capacity from 345,000 MT to 460,000 MT per annum.
In the medium-term, after the completion of the expansion project by 2008-end, a growth of 30% is targeted, the official added.
The Indian component of the project cost would be financed through internal accruals and not through overseas funds.
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First Published: Sun, Jul 08 2007. 05 12 PM IST