To help debt-ridden MSRDC in raising additional debt of Rs 15,800 crore for four big-ticket infrastructure projects
Consultancy firm EY will assist debt-ridden Maharashtra State Road Development Corporation (MSRDC) in raising additional debt of Rs 15,800 crore for four big-ticket infrastructure projects.
The new funds will be raised for new projects that the corporation plans to take up in the years to come, namely, Mumbai-Pune Expressway Augmentation (Rs 5,385 crore), Versova-Bandra Sea Link (Rs 7,500 crore), Thane Creek Bridge (Rs 800 crore) and Satara-Kagal Highway six-laning (Rs 1,000 crore).
"Last week, MSRDC's Board approved appointment of EY as consultant and transaction advisors for debt raising. We had received proposals from three firms for the same," said an MRSDC official.
In the next few months, EY will suggest if bonds can be issued to raise funds or through bankers or with the help of funding agencies, added a senior MSRDC official.
MSRDC has also tied up with SBI Capital Markets to raise funds for Rs 46,000 crore Mumbai-Nagpur Super Communication Expressway project.
Currently, the corporation is in discussion with the lenders and sources shared that debt to the tune of $4 billion or Rs 28,000 crore will be raised from eight to nine financial institutions. State Bank of India and IDBI Bank are among the lenders that the corporation is in discussions with.
Therefore, the total fresh debt that will be raised will be anywhere above Rs 45,000 crore for these five big ticket infrastructure projects for Maharashtra.
The corporation will levy toll on the new projects it plans to implement to recover the investments made.
"Toll rights will be given to infrastructure companies, but the project will be executed on engineering, procurement and construction financial model," said an official.
Already, MSRDC is cash strapped and came under debt of Rs 6,326 crore as of March 2014 after it executed Mumbai-Pune Expressway and Bandra-Worli Sea Link projects. It had even monetised five entry points of Mumbai by giving away toll collection rights for Rs 2,100 crore for a period of 16 years and 11 months.
Due to the lack of funds, several projects planned by MSRDC remained on the drawing board and were given away to other government organisations. Among those projects was the Mumbai Trans Harbour Link project, having an estimated cost of Rs 17,750 crore, connecting Mumbai with the proposed Navi Mumbai International Airport. The project is now with the Mumbai Metropolitan Region Development Authority.
The other project that MSRDC lost was Inland Passenger Water Transport on the eastern and western coast of Mumbai. Now, Maharashtra Maritime Board along with Mumbai Port Trust and City and Industrial Corporation are executing the same passenger water transport project on the eastern coast to connect Ferry Wharf with Nerul and Mandwa.
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