Tamil Nadu to issue Rs 14,000 cr bonds under UDAY

Tamil Nadu government will issue on Monday bonds worth Rs 14,000 crore under UDAY, a bailout plan chalked out for the loss-making power distribution companies.

"Tamil Nadu government proposes to issue special securities of Rs 14,000 crore, under the Ujjwal Discom Assurance Yojna Scheme (UDAY)," the Reserve Bank said in a notification.

Eligible participants can subscribe to these special bonds between between 10.30 AM to 12 Noon on February 20, 2017.

The Power Ministry had made UDAY scheme operational in November 2015 for financial turnaround of power distribution companies (discoms).

"Allotment of securities and settlement will take place on February 22, 2017," the RBI said.

At minimum bid size of Rs 100 crore, the interest on bonds will be corresponding to yield on government securities as at the close of February 17.

The RBI said it will have the sole discretion to accept or reject any/all bids.

Earlier this month, Rajasthan government had informed about issuing bonds worth Rs 1,564 crore under UDAY.

Eight states -- Uttar Pradesh, Rajasthan, Chhattisgarh, Punjab, Jammu and Kashmir, Bihar, Jharkhand, Haryana -- had floated bonds worth Rs 98,959.97 crore in 2015-16 under the UDAY scheme.

Source : Moneycontrol