There is a ray of hope for out-of-work employees of Shree Maheshwar Hydel Power Corporation Ltd (SMHPCL) as Power Finance Corp (PFC) has raised its stake in the company and the new management plans to sanction funds for revival of the project.
PFC is one of the lenders to SMHPCL and has given a loan of Rs 700 crore along with guaranteeing Rs 400 crore towards bondholders of SMHPCL.
“SMHPCL has defaulted in repaying the loan to PFC and now PFC is enforcing its legal rights as per the pledge deed by invoking the shares pledged by the promoters of SMHPCL in favour of PFC and by partial converting sub debt loan into equity shares,” PFC said in a filing with BSE and NSE on Thursday.
PFC will now have a total shareholding of 23.32% in SMHPCL, the lender said.
When contacted, SMHPCL managing director AK Bahadur said, “We have to clear pending bills and salary dues and then make an assessment of the pending R&R (relief and rehabilitation) work so that the project could be revived.”
Maheshwar hydel project is a 400 MW run-off-the-river project on River Narmada, located about 100 km from Indore.
In December last year, the PFC Board took management control of the hydel project from the promoters who are minority shareholders.
Established in 1993 and promoted by MW Corp (erstwhile S Kumars), the hydel project has been in controversy since its inception.
Narmada Bachao Andolan has time and again held demonstrations and tried to stop work at the dam site. The NGO has also been asking for a re-survey of the proposed submergence.
About 9,000 families would be affected by the project. Though hundreds of villagers have already been rehabilitated in new settlements, the relief and rehabilitation work has been halted since 2011 as the company failed to infuse fresh funds.
According to Central Electricity Authority (CEA), the Maheshwar hydel project has been delayed by 14 years due to cash flow issues and inability to pay project affected people for rehabilitation.