Published On:December 31 2007
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White Field Paper Mills achieves financial closure

Rajahmundry: White Field Paper Mills Ltd, which is setting up a 600-tonnes-per-day (TPD) paper mill at Bayyavaram in West Godavari district, has achieved financial closure, according to Mr T. Srinivasa Rao, Chairman.

At a press meet at Kovvuru in West Godavari district, after the second annual general meeting, he said the plant would go into commercial production by April-May 2009, according to schedule. “We have to achieve financial closure by the end of December. We have done so before time,” he said.

He said the project cost was Rs 1,407 crore, of which the equity component was Rs 541.31 crore and the rest debt. “The promoters are putting in Rs 140.75 crore, the strategic investor (Daewoo Intl Corp) Rs 108.25 crore and the institutions/IPO account for Rs 515.55 crore. We will go in for the IPO at a later stage of the project,” he explained.

Of the debt component, he said, foreign currency term loans amounted to Rs 476.35 crore and rupee term loans, Rs 389.74 crore. He said SBI Caps had prepared the project report. “SBI has agreed to lend us Rs 250 crore, SBH Rs 100 crore and Andhra Bank Rs 40 crore.”

Mr Rao said the paper mill, which has been granted the status of a special economic zone, would trigger economic growth in the two Godavari districts and create 2,000 direct jobs. “We have all the clearances and the basic infrastructure is in place. Administrative staff, numbering 75, has been appointed. We are in possession of 271 acres allotted by the Government and we have developed 200 acres of it,” he said.

The machinery for the plant would be supplied by Allimand SA, France, at a cost of €78 million and the order would be placed shortly. The machinery for the 80-mw captive power plant would be supplied by Dong Fang of China.

“We need 40 mw for captive consumption and the rest would be supplied to Power Trading Corporation. We have signed the PPA for 25 years. We also have the coal linkage and, at a later stage, we are expecting supply of natural gas, out of the quota of the State Government,” he said.

He expressed confidence that the project would be commissioned on schedule. “We also have a buyback agreement for 60 per cent of the product. Of the remaining 40 per cent, 20 per cent will be deemed exports and the rest will be sold in the domestic market,” he added.

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