SC puts an end to Dabhol issue

The Supreme Court on Wednesday put an end to the vexatious litigation between shareholders of Dabhol Power Corporation - GE and Bechtel - and the Maharashtra government following an out-of-court settlement.

The court was informed by the parties, after the settlement, that they want to give a quietus to the litigation so that DPC could be restarted.

The Supreme Court ordered that 85.85 per cent of DPC shares held by GE and Bechtel be transferred to Newage Power Company, a special purpose vehicle floated by GE and Bechtel.

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This is in accordance with the two shareholders (GE and Bechtel) reaching an agreement with domestic financial institutions earlier this month as part of the settlement.

While GE is likely to get $145 million, Bechtel is understood to have settled for $160 million with the financial institutions.

Setting aside previous resolutions adopted by the board of directors of DPC on June 4, 2002, the Supreme Court cleared the way for Maharashtra Power Development Corporation to nominate two directors on the board of Newage Power Company.

The judgment would pave the way for all major stake holders involved in the revival of DPC to start work on their plans, especially by the new joint venture company - Ratnagiri Gas and Power.