May 30, 2013 / 8:43 AM / 4 years ago

Power Finance Corp eyeing stake buy in state-run bank

Indian currency of different denominations are seen in this picture illustration taken in Mumbai April 30, 2012. REUTERS/Vivek Prakash/Files

NEW DELHI (Reuters) - Power Finance Corp Ltd(PWFC.NS) is looking to buy a stake in a state-run bank and also plans to set up a private equity fund jointly with Tata Capital, its chairman said on Thursday.

“We are looking to buy a substantial stake in a PSU (public sector unit) bank which will allow us to have a representation at the board level,” Satnam Singh told reporters.

The state-run lender for power projects has sent a letter to the power and the finance ministries expressing its interest in buying a stake in any state-run bank a month ago, Singh said.

Indian power utilities have struggled to build new plants, as projects get mired in red tape or suffer acute supply shortages of coal or gas.

“To begin with, it (the private equity fund) will be of $300 million and eventually, it will be a $1 billion fund,” he said.

Earlier, the company posted a 58.19 percent rise in quarterly net profit from a year earlier.

Reporting by Nidhi Verma; Writing by Malini Menon;; Editing by Anand Basu

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