Hyderabad Metro achieves financial closure
05 Apr 2011
The Hyderabad Metro project achieved financial closure on Tuesday, making it the largest fund tie-up in India involving a public private partnership (PPP) project. The financial closure was achieved in a record time of six months.
A consortium of banks led by State Bank of India (SBI) has sanctioned the entire debt requirement of Rs11,480 crore for the project.
The project will be executed by L&T Metro Rail (Hyderabad) Ltd, a special purpose vehicle (SPV) incorporated to implement the project.
The equity component, expected to be around Rs3,440 crore, would be infused primarily by the L&T group. The project will get a viability gap grant of Rs1,458 crore from the Central Government through the government of Andhra Pradesh.
Ten banks are participating in the funding for the project, including the Canara Bank, Indian Bank, Indian Overseas Bank, Jammu & Kashmir Bank, Punjab & Sind Bank, State Bank of Hyderabad, State Bank of Mysore, State Bank of Patiala and Syndicate Bank.
The Hyderabad Metro project was announced by the Andhra government as a PPP under the design, build, finance, operate and transfer (DBFOT) basis. L&T emerged the lowest bidder (the bid winning criteria was minimum grant quoted by the bidder).
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