Mumbai:

Punjab Alkalies has asked UTI Bank to scout for a strategic partner for picking up the Punjab state government’s 23.49-per cent stake in the company. The bank will also help the Delhi-Gurgaon Expressway Ltd, a special purpose vehicle floated by JK Industries, for the construction of the National Highway Authority of India’s Delhi-Gurgaon road project.

Says a senior UTI Bank official: “We have been mandated for the stake sale of Punjab Alkalies recently. As far as the road project is concerned, the financial closure will be achieved soon.”

Recently, the Punjab government had decided to reduce its exposure in three state-run public sector units. These include Punjab Tractors, Punjab Communications and Punjab Alkalies & Chemicals.

The state controls both Punjab Tractors and Punjab Alkalies through Punjab State Industrial Development Corporation, which holds a 23.49-per cent stake in each company. The road project will be funded via market mobilisation and by issuing infrastructure bonds. The total cost of the project is estimated at Rs 500 crore.

“On commissioning the Delhi-Gurgoan project, free access will be provided from the international airport to the national capital and, thus, the hardships due to traffic congestion for the heavy vehicular traffic and commuters would be eliminated,” the official adds. At present, the average travel time for the journey between Dhaula Kuan to Gurgaon is 45 minutes; this would be cut to around 20 minutes.

The official says UTI Bank has subscribed the entire Rs 200-crore non-convertible debenture issues of LIC Housing Finance and Rs 130 crore of Hindustan Machine Tools (HMT). The coupon rate for LIC Housing was 7.5 per cent while HMT’s coupon rate was pegged at 8.5 per cent.

LIC Housing mobilised funds for housing finance activities and the issue was closed on 25 November 2002. HMT has mobilised around Rs 310 crore for capital expenditure. ICCI Bank was the other subscriber of the HMT issue.