Although no official statements have been made from officials of both the companies but according to sources Essel group has already initiated the take over process.
Even before the Maharashtra State electricity Distribution Company Ltd could give its approval, the Essel group of companies has already started the process to take over operations from electricity distribution franchise Spanco in three out four zones of Nagpur. It has been learnt that the Essel group has also appointed a company named KPMC for conducting the financial audit of Spanco’s accounts. The company has also invested about Spanco 50 crore in Spanco.
It may be recalled that Spanco had obtained electricity distribution franchise from MSEDCL in three divisions of the district after a long fought struggle. However, Spanco failed continuously to pay for the electricity procured from MSEDCL and to create a Escrow account for direct payment of dues. The issue was also raised in the assembly. Finally the escrow account was created in January this year. Meanwhile, the debts increased to Rs 265 crore. MSEDCL even issued a take over notice to Spanco. The pressure from contractors has also increased. Meanwhile, all efforts made by Spanco officials to obtain loan had failed. Giver the circumstances the only possible alternative left was to take in an associate financier. But the Essel group demanded to become a direct partner. The company has decided to run the franchise themselves.
Although no official statements have been made from officials of both the companies but according to sources Essel group has already initiated the take over process. It has been learnt that Essel has already invested another Rs. 50 crore for the purchase of equipment to enhance network and for structural development. However, the Essel group would not be able to take over operation immediately as Spanco has sought a period of 60 days to wrap up.
On the other hand MSEDCL officials refuse to have any knowledge of the take over. Officials speaking on the issue said that Spanco would have to get an approval from MSEDCL before any such take over. However, as of now no such information has been provided, said officials.
Sources have informed that the contract given to Spanco is for 15 years and if Spanco is removed, tenders would once again have to be called. If this happens then the back door entry of the Essel group could come into trouble.