Overview

• Talcher Fertilizers Limited (TFL) is a Joint Venture of GAIL (India) Ltd, Coal India Ltd and Rashtriya Chemicals and Fertilizers Ltd (RCFL) and Fertiliser Corporation of India Ltd (FCIL), with each holding 31.85% stake and FCIL holding 4.45% Equity stake. 
• TFL is implementing an integrated fertilizer complex including 3,850 MTPD Urea Unit at Talcher, Angul district, in the state of Odisha.
• Major apprehension by lenders to part fund the project was due to utilization of new technology to manufacture Urea and absence of a Urea Policy by Govt of India at the time of sanction of debt for the project.
• SBICAPS appointed as Debt Arranger for the Project

Deal Highlights

• First Coal Gasification based Fertilizer Unit  being set-up in India with indigenous Coal as feedstock. Present Urea units are majorly based on Natural gas as feedstock.
• Lenders agreed part fund the Project based on new technology/ route for manufacture of Urea with Coal as feedstock on Project finance basis without any Corporate Guarantee
• New Urea Policy was under formulation at the time of sanction of debt of TFL, which has now been approved by Govt of India 
• The Project is expected to set a precedence to manufacture Fertilizer and Chemicals in the Country from Coal

SBICAPS Value Add

• Successfully syndicated the entire debt through Book Building process while suitably addressing the apprehensions of lenders and which helped in receiving final sanctions aggregating to two times that of required debt amount
• Further, assisted Company in its proposal of Urea Subsidy policy being formulated by Government of India based on Target Post Tax Equity IRR