GMR Hyderabad Vijayawada Expressways Private Limited

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GMR Hyderabad Vijayawada Expressways Private Limited was created to implement a project to expand from two lanes to four to six lanes 181 km of the Hyderabad – Vijayawada section on NH-9 in the state of Andhra Pradesh. The project also included 2 major bridges, 32 minor bridges, and 174 culverts. Under the contract, the consortium was responsible for the design, construction, finance, operation and maintenance and widening of the existing two-lane highway to a four-lane highway with paved shoulders. 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 Hyderabad Vijayawada Expressways Private Limited was an SPV owned by GMR Infrastructure Limited (74%) and Punj Lloyd Limited (26%). The National Highway Authority awarded the project to GMR on a Build, Operate and Trasfer (Toll) basis on a 25 year concession (including construction period) through an international competitive bidding route. The consortium was one of the five bidders for the highway project, which was caught in controversy after several rounds of litigation in the Delhi high court and the Supreme Court of India over who would be allowed to place bids for the project. GMR won the tender through competitive bidding, conducted by NHAI, by quoting the maximum revenue share with the Government. The winning consortium committed to share 31% of the revenue in the first year with an annual increment of one percentage point for the duration of concession period of 25 years. Under the contract, GMR was to recover the capital costs and operating costs including returns through tolling during the term of concession. Further details of bidding were not available at the time of collection of this information. The letter of award was issued in May 2009. The concession agreement was signed in January 2010. The project cost was estimated to be INR17.5 billion (US$382.7 million). The project reached contractual closure in April 2010, with a debt component of INR17 billion. IDBI Bank was underwritten the loan. Construction began in October 2009 and was expected to conclude in October 2012.