LTL Group inks financing for another offshore power project

Wednesday, 3 December 2014 00:00 - - {{hitsCtrl.values.hits}}

LTL Group’s flagship company, Lakdhanavi Ltd achieved another key milestone in its offshore expansion strategy when a $ 35 million long term syndicated loan agreement was signed with five financial institutions in Dhaka, Bangladesh last week.

From left: NDB Capital CEO Kanti Kumar Saha, Hatton National Bank Senior Manager Project Finance Dilunika Jasinghe, Commercial Bank of Ceylon Senior Manager Investment Banking Sushara Vidyasagara, Corporate Finance & FCBU Assistant General Manager Shashi Kandambi Jassim, Lakdhanavi CFO Ravindra Pitigalage, Lakdhanavi GM (Offshore Operations) U.G. Sarath, Commercial Bank, Dhaka Country Manager Ajith Narampanawa, IDCOL, Bangladesh Director (Investment) and Head of Advisory Nazmul Haque, NDB Bank Assistant Vice-President – Legal Vidisha Jayawardena, NDB Investment Bank CEO Darshan Perera This loan is intended to finance 70% of the cost of its second power project in Bangladesh, by way of USD denominated debt. Equity was financed by Lakdhananvi Ltd and Lanka Energy International Ltd a subsidiary of Lanka Ventures Ltd. This thermal power plant of 50 mw capacity is nearing completion in key industrial city of Comilla in central Bangladesh. Lakdhanavi already owns another power plant of similar capacity in Northern Bangladesh which is in operation. Both power plants have 15 year contract with Bangladesh’s state owned power utility to sell its full capacity to Bangladeshi national grid.

According to LTL Group CEO U.D. Jayawardana, the company is filling a vacuum created by the recent retirement of two of its power plants which have successfully completed their full contract term with CEB. “We have found an ideal market in Bangladesh for investment in power generation, with its huge supply-demand deficit, safe investment climate and an environment that welcomes IPPs as aconcept to fill shortages of local capital formation for infrastructure development,” he said. He is confident LTL will develop more projects there in future. The loan also signifies an important achievement of offshore lending for four Sri Lankan banks i.e. Commercial Bank of Ceylon PLC, Hatton national Bank PLC, NDB Bank PLC and Sampath Bank PLC. The Infrastructure Development Company Limited (IDCOL), a development financial institution in Bangladesh was the fifth financial institution to the syndicate. NDB Investment Bank and NDB Capital Ltd, Bangladesh acted as joint arrangers.