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In a first, Welspun ties funds for road project under ‘Hybrid Annuity Model’
Welspun Enterprises on Monday has closed financing for the country’s first expressway project under the ‘Hybrid Annuity Model’ on Delhi-Meerut Expressway with the total cost of ?841.50 crore.
Of the total project cost, 40 per cent will be funded by the National Highways Authority of India (NHAI) under the new Hybrid Annuity Model, the company said. The remaining 60 per cent will be arranged by the concessionaire by way of mix of debt/equity of 48:12, 12 per cent being the promoter’s contribution and rest will be funded by Punjab National Bank-led consortium, it said.
Hybrid Annuity Model (HAM) is a mix investments done by government and private players and payment is also made in a fixed amount for a considerable period and then in a variable amount in the remaining period.
“With infrastructure spending going up, Hybrid Annuity Model is an opportunity to fast track highway projects and revive public- private-partnership mode. It will not only improve the traffic flow between the two states, but also contribute to enhancement of economic activity in the region,” Raghav Chandra, Chairman, NHAI, said. The project will be developed in 2.5 years, and thereafter the maintenance on the stretch for 15 years will be done by Welspun Delhi– Meerut Expressway Pvt. Ltd. It stretches across 8.716 km and is entirely within the city of Delhi. It consists of a six-lane express way in the centre, flanked by two four-lane highways on either side — making it 14-lanes in all. Will Hernandez Jersey
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