Satyam effect: Maytas Infra facing tough time in Orissa

Monday February 16, 01:41 AM

Source: Indian Express Finance

Satyam effect: Maytas Infra facing tough time in Orissa

By Dilip Bisoi

Maytas Infra, the infrastructure company run by Satyam's disgraced founder B Ramalinga Raju's son Teja Raju, is facing serious problems in Orissa with its business collapsing there.

Maytas Infra widened its business interest in the state by bagging a number of power and irrigation projects. However, after the Satyam scam, Maytas is finding it really difficult to keep itself afloat.

The company first lost its job in Anil Agarwala-owned Vedanta Aluminium Ltd, which is putting up an aluminium complex and power plants in Jharsuguda. Maytas, which was involved in construction of the power plant, however, has challenged the breach of contract by project promoters. Central-sector utility Power Grid Corporation of India Ltd (PGCIL) had awarded rural electrification works to Maytas under the Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) in Orissa's Jajpur district. The contract has been cancelled after the Satyam scam unfolded.

Maytas is not on the good book of the state government either. It forced promoters of KVK Nilachal Power Company to remove Maytas from the project. Buckling under pressure, KVK Energy of Hyderabad, the main promoter of the project, has acquired the 25% stakes of Maytas in the company. KVK Nilachal is setting up a 1000 mw thermal project in Cuttack district. Maytas also lost the EPC contract for the project.

"We have asked the promoters of the Nilachal Power to take a fresh look at the share holding patterns following the Satyam scam", said state energy minister SN Patro. Maytas recently received another serious blow when Orissa Power Transmission Corporation Ltd (OPTCL), a state-owned company, cancelled all the contracts with it.

Maytas Infra was one of the bidders for several infrastructure projects including the 220/33 KV grid sub-station at Karadagadai in Khorda district. Even though the technical and financial bids for the project were opened, the OPTCL board decided to reject the ones of Maytas. According to OPTCL chairman and managing director CJ Vendugopal, the board on February 9 rejected all the bids of Maytas as the firm was facing liquidity crunch. He said OPTCL had the right to reject any contracts with any firm on the financial ground.