Jaiprakash Power Venture Ltd, the fully owned subsidiary of Jaiprakash Associates Ltd, is planning to merge with Jaiprakash Hydro Power Ltd in a bid to arrange funds worth Rs 3,000 crore to Rs 4,000 crore through qualified institutional placement (QIP). Jaiprakash Associates currently owns 63 per cent stake in JHPL that may rise to over 80 per cent post merger.

The board of company is meeting on July 3, 2009 to consider an amalgamation between two companies besides fund raising issues through ADR/GDR/FCCB routes. The board has also formed a committee of directors evaluate all pro and cones of merger.

A market source said, "JPVL is expected to be valued at around Rs 12,000 to Rs 14,000 crore and the merged entity will be over Rs 16,000 crore."

Jaiprakash Power Ventures is planning to set up over six hydro and thermal power projects in different states of the country. It had earlier planned to raise funds through an IPO in 2008. However, uncertain market conditions did not allow it to enter in the capital market.

Manoj Gaur, Executive Chairman of Jaiprakash Associates, said: "We will discuss and decide what is in the best interest of the company and its shareholders."