VIL Rohtak-Jind Highway Private Limited

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In December 2011,the National Highway Authority of India (NHAI) awarded a concession(including construction period of 24months) to Vijai Infrastructure Limited (VIL) for the strengthening, improvement, 4-laning, operation and maintenance,and tolling of 48.6kms of Rohtak-Jind Section from km 307.000 to km 347.800 of NH-71 and connecting link from km 347.800 of NH-71 to km 9.400 of NH-71A in the State of Haryana. Under the contract, VIL was responsible for the design, construction, finance,operation and maintenance and widening of the existing 2-lane carriageway to a 4-lane highway with paved shoulders. The scope included construction of new pavement, rehabilitation of existing pavement, construction and/or rehabilitation of major and minor bridges, culverts, road intersections, interchanges, drains, etc. The expansion project was part of National Highway Development Project Phase-III.The proposed two-lane road is expected to improve the connectivity in the interior areas of Jaintia Hills besides largely reducing traffic snarls in and around Jowai town.Significant stimulus to trade and commerce in the entire region was expected. Vijai Infrastructure Limited established VIL Rohtak-Jind Highway Private Limited, a special purpose vehicle, to implement the project. The SPV won the tender through international competitive bidding, conducted by NHAI, by requesting the lowest upfront subsidy of US$ 11.7mn (INR 685mn @58.6 INR/USD). Please note that the project was first awarded to NKG Infrastructure Limited in August 2011 at a quoted premium of INR 10mn. However NHAI cancelled the Letter of Award (LOA) to NKG Infra on 28 October 2011. Reasons for the cancellation couldn't be ascertained. The LOA was then awarded in December 2011 to L2 Bidder- Vijai Infrastructure Limited. The other bidder was PNC Infratech which quoted a grant of INR 990mn. There were 42 pre-qualified bidders out of which 5 offered their final bids for the project. 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 for the project was signed on 5th June 2012. The project attained financial closure on 16th April 2013. The grant/debt/equity ratio for the project was 17/66/17. The estimated capital cost of the project at the time of financial closure was US$ 70mn (INR 4100mn @58.6 INR/USD).Apart from viability gap funding (grant) of INR 685mn,financing comprised of a 15-year term loan of US$ 46.1mn (INR 2700mn) and sponsor equity of US$ 12.2mn (INR 715mn). The term loan had a grace period of 12-months and repayment schedule of 144 monthly installments.The debt was arranged by Central Bank of India and the participating banks were Corporation Bank (450mn),Dena Bank (500mn),Union Bank of India (750mn),Vijaya Bank (200mn). Construction on the project was expected to begin in April 2013 and complete by April 2015.