GMR Ambala Chandigarh Expressway Pvt. Ltd.

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In June 2005, the National Highway Authority of India (NHAI) awarded a 20 year concession contract to India’s GMR Group to widen and strengthen the 35.1 km section on National Highway (NH) 21 & NH 22 between Ambala and Chandigarh, in Punjab state. Under the contract, GMR was responsible for the operation, maintenance, and widening of the existing two-lane highway to a four-lane highway with paved shoulders. In addition, the project included nearly 21 km of service roads, two flyovers and 16 bus bays. The expansion project, part of National Highway Development Project - Phase III, was expected to ease traffic congestion and give significant stimulus to trade and commerce in the entire region. GMR Group established GMR Ambala Chandigarh Expressway Pvt. Ltd, a special purpose vehicle, to implement the project. GMR won the tender through an international competitive tender, conducted by NHAI, by making the lowest subsidy request – a negative grant of US$ 12.34 million (net present value discounted at 10%) during the concession term of 20 years. The concession agreement for the project was signed in November 2005 and the project reached financial closure in May 2006. The total capital cost of the project was estimated at US$ 86.5 million. The company raised US$ 62.3 million in senior debt from six bankers namely the Central Bank, Punjab National Bank, Bank of Maharashtra, State Bank of Patiala, Corporation Bank and the State Bank of Hyderabad. The debt syndication was done by UTI Bank Limited. The door to door tenure of the loan was 16 years including the repayment of loan in 12 years. Construction on the project began in May 2006 and was expected to be completed by November 2008. As per NHAI, the project was completed in March 2009 and is currently operational.