Bhubaneswar: Odisha government Wednesday decided to convert Rs 400 crore worth of convertible and non- convertible bonds of OPTCL, State owned power transmission company, into equity.

It was State-owned Gridco which had issued convertible bonds of Rs.200 crore and nonconvertible bonds of Rs.200 crore in favour of government of Odisha for up valuation of erstwhile OSEB assets and transferred to Gridco in course of power sector reform process in early 1990s. These bonds of Rs.400 crore have been subsequently transferred to OPTCL by Government Transfer Notification dt.09-06-2005.

OPTCL has requested for conversion of convertible bonds of Rs.200 crore and also the non-convertible bonds of Rs.200 crore as the up valuation of assets and servicing of the bonds have not been considered in determination of transmission tariff. As such, OPTCL is not in a position to service the interest and redeem the non-convertible bonds. It was earlier decided by State government that bond will not carry any interest up to FY 2010-11.

The State cabinet Wednesday has approved the proposal for conversion of bonds including interest accrued thereon to equity investment of government in OPTCL. This will increase the equity capital investment of government in OPTCL thereby reducing the interest burden of OPTCL.