Sion Panvel Tollways Private Limited

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On 19th January 2011, the Maharashtra State Road Development Corporation (MSRDC) signed a 17-year 5-months concession (including construction period) with a consortium of IVRCL and Kakade Infrastructure Pvt Ltd. (KIPL) for the strengthening, improvement, widening, operation and maintenance of 23kms of Sion-Panvel corridor connecting between Mumbai and Navi Mumbai in the state of Maharashtra. Under the contract, the consortium was responsible for the design, construction, finance, operation and maintenance,strengthening and widening the existing 3+3 lane bitumen road to a 5+5 main carriageway in rigid pavement. The project also includes the widening of existing and new major and minor creek bridges, flyovers, vehicular and pedestrian underpasses, and foot over-bridges. A toll plaza is to be set up at Kamothe at the end of the flyover near Taloja junction with 15+15 lanes for collecting toll. The highway extends from BARC junction to Kalamboli junction.New Panvel is strategically located on the eastern side of the Mumbai-Bangalore national highway (NH-4) and the Mumbai-Pune Expressway. This is a strategic extension of Pune-Mumbai Expressway by another 23.09 kms up to the BARC junction. Besides cutting down on travel time, the other benefits expected of this road widening are increase in traffic and trade activities, entry of more businesses in the region and infrastructure developments. The consortium of IVRCL (51% - through its asset holding subsidiary company IVRCL Assets & Holdings Ltd), and Kakade Infrastructure Pvt Ltd. (KIPL -49%), established Sion Panvel Tollways Private Limited, a special purpose vehicle, to implement the project. The SPV won the tender through international competitive bidding, conducted by MSRDC, by quoting the shortest concession period 17-years 5-months.Under the contract, the SPV was to recover the capital costs and operating costs including returns through tolling during the term of concession. The concession agreement was signed on 19th January 2011. The project attained financial closure on 30th May 2011. The debt equity ratio of the project was 76:24. The estimated capital cost of the project at the time of financial closure was US$ 379 (INR 17057mn @ 45 INR/USD) million. Financing comprised INR 9092mn 14-year 6-month term loan, INR 3900mn 6-year term loan, and INR 4065mn equity. The 9092mn term loan had a grace period of 1 year repayment schedule of 114 monthly installments.The 3900mn term loan had a draw down from June 2011, a grace period of 1 year and 2 annual payments. The debt was arranged by SBI Capital Markets.The participating banks were Indian Overseas Bank Ltd(1992m), Bank of India(1050m),Canara Bank(750m) Oriental Bank of Commerce(800m),Andhra Bank(1150m), Vijaya Bank(550m),State Bank of Bikaner & Jaipur(350m),Karnataka Bank Ltd(590m),Tamilnad Mercantile Bank(260m),India Infrastructure Finance Co Ltd(1600m). Construction on the project began in March 2011 and was expected to be completed by March 2015.