ISLAMABAD: The Privatisation Commission (PC) has urged the Power Division to expedite necessary approvals of debt recapitalisation of RLNG-fired power plants, sources in PC told Business Recorder.
Sharing the details, sources said, as part of the privatisation process of National Power Parks Management Company Limited (NPPMCL), Government of Pakistan approved the “debt recapitalisation and refinancing of NPPMCL” through competitive process to raise long-term debt up to Rs 110 billion. Accordingly, upon direction of Privatisation Commission, NPPMCL has invited proposals/bids from banks/financial institutions on the basis of “Request for Proposal (RFP)” provided by the Privatisation Commission.
As per provisions of the RFP, security/collateral for the said long-term loan would be as per the Implementation Agreements (IA) and Power Purchase Agreements of the power projects, ie, mortgage/charge over fixed assets of the company, assignment over capacity receivables and pledge of company’s shares in favour of the banks/financial institutions. Accordingly, the banks have requested NPPMCL to approach its shareholder for arrangement of necessary internal approvals for signing of share pledge agreements with the banks/financial institutions for the said transaction.
The source said 249,999,997 shares of the Company already stand issued in the name of President of Pakistan against the Seed Money injected by the Government of Pakistan.
The Privatisation Commission has requested that approval of the Federal Government for signing of Share Pledge Agreements (SPAs) with the banks/financial institutions be arranged with respect to the shares held in the name of the President of Pakistan along with authorization of any suitable officer of the Power Division to sign it.
Meanwhile, NPPMCL has said that its receivables are gradually pilling up and have reached Rs 181.17 billion out of which Rs 155 billion are overdue.
According to the company, this critical situation is creating hardships for NPPMCL to settle its contractual liabilities like payment to SNGPL, insurance company, payment of markup on working capital facilities, payments to Long Term Service Agreement (LTSA) and O&M contractors’ fee, etc.
NPPMCL has already requested CPPA-G to release funds from energy receivables of the company to settle outstanding RLNG bills of SNGPL. Further, NPPMCL also requires funds from capacity receivables of the company to settle its critical contractual liabilities.
Copyright Business Recorder, 2022