IRB Infrastructure’s SPV reaches financial closure for $321m six-lane project


India’s IRB Infrastructure Developers’ special purpose vehicle (SPV) Udaipur Tollway has achieved financial closure for its Rs20.88bn ($320m) Udaipur-Gujarat Border six-lane project.

Under a concession agreement signed with the National Highway Authority of India (NHAI), the SPV has tied up with the consortium of lenders to finance the build-operate-transfer (BOT) project.

The consortium of lenders led by Canara Bank and comprising Bank of India, Bank of Maharashtra, Oriental Bank of Commerce, Indian Overseas Bank, Andhra Bank and Aditya Birla Finance will provide a loan of Rs14.61bn ($225m) at an interest rate of 10.65% per annum.

The remaining project cost project will be funded by equity contribution of Rs6.27bn ($96m) by the company.

"Having achieved financial closure on one out of the three NHAI Projects awarded last fiscal, the company can bid competitively for upcoming NHAI projects."

IRB Infrastructure Developers chairman and managing director Virendra Mhaiskar said: “We thank the consortium of lenders to continue to show trust in us and our projects, and providing finance for this project.

“Now having achieved financial closure on one out of the three NHAI Projects awarded last fiscal, the company can bid competitively for upcoming NHAI projects.”

The 113.8km project involving six-laning of NH-8 between Udaipur to Gujarat Border has a concession period of 21 years, which includes a construction period of 910 days.

In the last fiscal, IRB secured three projects, with one achieving financial closure.

Currently, the company is discussing with lenders for financial closure on the remaining two projects.