Yamunanagar Panchkula Highway Private Limited

cancelled

In March 2012, the National Highway Authority of India (NHAI) awarded a 22-year concession (including construction period of 2.5 years) to Gammon Infrastructure Projects Limited (Gammon) for the strengthening, improvement, 4-laning, operation and maintenance, and tolling of 104.77kms of Uttar Pradesh/Haryana Border-Yamunanagar-Saha-Barwala- Panchkula Section on NH-73, in the state of Haryana. The project includes new bypasses at Yamunanagar, Saha, Sahazadpur, Dangri and Barwala. Under the contract, Gammon was responsible for the design, construction, finance, operation and maintenance and widening of the existing 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, part of National Highway Development Project Phase-III would ease traffic congestion and give significant stimulus to trade and commerce in the entire region. Gammon Infrastructure Projects Limited established Yamunanagar Panchkula Highway Private Limited (YPHPL), 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$ 55.8mn (INR 2790mn @50 INR/USD). 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 30th July 2012. The project attained financial closure on 26th November 2012. The grant/debt/equity ratio for the project was 20/69/10. The estimated capital cost of the project at the time of financial closure was US$ 275.2mn (INR 13760mn @50 INR/USD). Apart from viability gap funding (grant) of INR 2790mn, financing comprised of 15-year term loan of US$ 191mn (INR 9550mn) and sponsor equity of US$ 28.4mn (INR 1420mn). The debt was arranged by Bank of India. Construction on the project was expected to begin in November 2012 and be completed by May 2015. In March 2014, NHAI canceled the concession for the project on amicable terms as YPHPL was unable to start construction activities at the project site on account of non-availability of land and certain government approvals.