Wednesday, July 20 2005 14:47 Hrs (IST) - World Time -

New Delhi: The Supreme Court today (July 20, 2005) put an end to the vexatious litigation between shareholders of Dabhol Power Corporation, General Electric (GE) and Bechtel and the Maharashtra Government following an out of court settlement.

The parties informed the court after the settlement, that they want to give a quietus to the litigation so that DPC could be restarted.

The Supreme Court ordered that the 85.85 per cent of the shares held by DPC through its two shareholders GE and Bechtel be transferred to Newage Power Company, a Special Purpose Vehicle (SPV) floated by GE and Bechtel. This is in accordance with the two share holders (GE and Bechtel) reaching an agreement with domestic financial institutions earlier this month as part of settlement.

GE is likely to get 145 million dollars while Bechtel is understood to have settled at 160 million dollar payment with the financial institutions.

Setting aside previous resolutions adopted by the DPC's Board of Directors on June 4, 2002, the Supreme Court cleared the way for Maharashtra Power Development Corporation Limited to nominate two directors on the Board of Newage Power Company Private Limited.

The judgement today would pave the way for all the major stakeholders involved in the revival of DPC to start work on their plans especially by the new Joint Venture Company Ratnagiri Gas and Power private limited.

According to the Supreme Court, until all the shares of DPC were transferred to and in favour of Newage Power Company, the Board of Directors of DPC would be re-constituted with the Maharashtra Power Development Corporation, Newage Power Company and Indian Financial Institutions nominating two directors each to it

GE and Bechtel held 85.85 per cent shares of DPC of which they had 10 per cent each originally and the two had acquired 65.85 per cent of Enron in DPC.

To start with Northwest Territories Power Corporation (NTPC), a 50 per cent stakeholder in Ratnagiri Gas and Power Limited, has already announced pumping in Rs 500 crore as equity capital and Gas Authority of India (GAIL) and Financial Institutions would also pump similar amount in.

With the total paid up capital at Rs 1500 crore the balance Rs 8,536 crore would be considered as loan component.

During the process the total assets of Rs 10,036 crore would first be transferred to the Financial Institutions by Newage Power Company and finally by the Financial Institutions to Joint Venture company between NTPC and GAIL.

NTPC is also understood to have sough some exemptions including waiver of stamp duty to be paid while transferring of assets and from paying import duty while importing Liquified Natural Gas (LNG) to restart electricity generation from the plant, lying idle for over four years now.