Dhule Palesner Tollway Lmited

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In June 2009, the National Highway Authority of India (NHAI) signed a 18 year concession (including construction period of 30 months) with Dhule Palesner Tollway Limited for strengthening and widening the 96.5-km Highway from Dhule in Maharashtra to the town of Palesner near Maharashtra-Madhya Pradesh border on National Highway-3 (NH3). Under the contract, the Dhule Palesner Tollway Limited was responsible for the design, construction, finance, operation and maintenance and widening of the existing four-lane highway to a six-lane highway with paved shoulders. The expansion project, part of National Highway Development Project Phase - IIIA, was expected to ease traffic congestion and give significant stimulus to trade and commerce in the entire region. The consortium of India's Hindustan Construction Company Limited (HCC - 37%), UK's John Laing Infrastructure Limited (36%), and India's Sadbhav Engineering (27%) established Dhule Palesner Tollway Limited, a special purpose vehicle, to implement the project. The consortium won the tender through competitive bidding, conducted by NHAI, by quoting the minimum subsidy required. The details of bidding were not available at the time of collection of this information. Under the contract, the concessionaire was to recover the capital costs and operating costs including returns through tolling during the term of concession. The concession agreement was signed in June 2009. The estimated capital cost of the project was US$ 293.3 (INR 14200 mn @ 48.41 INR/USD) million. The project attained financial closure in December 18th 2009 with a debt equity ratio of 75:25. A consortium of 12 financial institutions led by State Bank of India will be lending US$ 220 million (INR 10650 million @ 48.41 INR/USD) crore for the project. The consortium included Punjab National Bank, Bank of Baroda, Allahabad Bank. Corporation Bank, Dena Bank, Syndicate Bank Ltd, Oriental Bank of Commerce, State Bank of India, State Bank of Patiala, State Bank of Bikaner & Jaipur, State Bank of Indore, and Indian Infrastructure Finance Company. The average interest rate on the loan was about 11% and the repayment period was 15 years. The balance US$ 73.3 million (INR 3550 @ 48.41 INR/USD) million will be brought in as equity by the project sponsors. Construction on the project was expected to begin in June 2009 and completed by Dec 2011.