September 08, 2008

DVC appoints KPMG for organizational restructuring

BL reported that Damodar Valley Corporation has appointed KPMG to facilitate organizational restructuring by way of creating a corporate entity under the corporation and paving the way to tap the capital market through an initial public offering.

As per the letter of intent issued by the DVC last week, KPMG will enjoy a handholding relationship with DVC till the IPO and will be responsible for recommending ways and means for restructuring, facilitating compliance of all legal formalities for the same and finally determining the issue size, timing and other details pertinent to the IPO.

To begin with, KPMG will submit a report within 3 months recommending ways to create a new structure without requiring any amendment to the existing DVC Act. The entire focus would be to let DVC enjoy the benefit of the two worlds. The IPO route is explored primarily to finance DVC’s plan to emerge as one of the largest power producer by the end of the 11th Plan.

A DVC official said that “The proposed restructuring has to be approved by all 3 stakeholders of DVC including the state governments of West Bengal and Jharkhand and the centre. Naturally, we may have to wait at least a year before the process is through.”