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S.ravi
Advanced Member
India
4205 Posts |
 Posted - 01/09/2009 : 19:38:25
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Metro Rail
Officials now admit that besides the flagship Satyam, Maytas Infra enjoyed a sort of most favoured company (MFC) status, bagging several contracts encompassing irrigation, transport, roads, drinking water and power projects at a speed not known earlier. It was almost like a green channel through which the company, either on its own or as part of a consortia, could get its projects sanctioned. The total cost of these projects is estimated at Rs. 30,000 crore, at the least, they contend.
There were several allegations when Maytas Infra bagged the Metro Rail project in September 2008: that the tenders were either tailor-made to suit the company leaving no chance for the competitors or works allotted on nomination basis.
Eyebrows were raised when the company secured Metro Rail project amidst stiff competition and none other than the father of metro rail in the country, E. Sreedharan, asked questions over the sustainability of a model that was linked to allotment of prime government land for real estate business.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 01/11/2009 : 04:24:00
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'Probe metro rail award to Maytas'
http://timesofindia.indiatimes.com/Hyderabad/Probe_metro_rail_award_to_Maytas/articleshow/3958156.cms
10 Jan 2009, 0512 hrs IST
HYDERABAD: Citizens for a Better Public Transport in Hyderabad (CBPTH) has
demanded CBI inquiry into the whole process of how Maytas bagged the
Metro Rail project and demanded that the project be scrapped in larger public
interest.
Addressing a press conference, CBPTH convener C Ramachandraiah said that even
the state government could order a thorough enquiry by transport experts and
retired bureaucrats to arrive at the facts.
He said all the officers connected with the Metro Rail project and who were
involved in scrutinizing the bid documents and awarding the contract to Maytas
should be transferred for ensuring impartial inquiry.
"The state government has been favouring Maytas for infrastructure projects. The
Hyderabad Metro Rail Project was also given to Maytas by reducing international
bidding to a farce," Ramachandraiah said.
He said Delhi Metro Rail chief E Sreedharan had remarked that there was no
transparency in the bidding and that it might lead to a political scam. "The
state government demanded an unconditional apology from Sreedharan, and
threatened to file a defamation suit against him. But even after three months,
the case is not filed though he refused to tender apology. This shows the
government's guilt," he said.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 01/11/2009 : 04:28:28
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Metro Sreedharan was the whistleblower?
http://www.dnaindia.com/report.asp?newsid=1220271
Saturday, January 10, 2009 2:38 IST
New Delhi: When Metro man E Sreedharan suggested that a "big political scandal"
was brewing in the Hyderabad Metro project in September last year, the Andhra
Pradesh government threatened him with defamation.
But, with Satyam chairman Ramalinga Raju confessing to defrauding his own
company of over Rs 7,000 crore and accepting the charge that the aborted buyout
of Maytas was also part of this fraud, Sreedharan's apprehensions appear to be
justified.
The Hyderabad Metro project is being developed by Maytas Infra, a company
promoted by Teja Raju, son of Ramalinga Raju, and other members of the Raju
family.
The Delhi Metro Rail Corporation chief had, in a letter to deputy chairman of
Planning Commission Montek Singh Ahluwalia, raised concerns about the AP
government's decision to award the Hyderabad Metro project to a consortium led
by Maytas on the build-operate-transfer (BOT) model. "The BOT operator (Maytas)
has a hidden agenda which appears to be to extend the Metro network to a large
tract of his private land holdings so as to reap a windfall profit of four to
five times the land price," the letter stated.
Ironically, Sreedharan's allegation not only drew criticism from the AP
government but also from the Planning Commission, which reportedly blamed the
DMRC chief for not backing his allegations with any evidence.
While Ramalinga Raju's son Teja is the main promoter of Maytas Infra, Ramalinga
Raju and his family hold about 20% equity as on September 30, 2008. Of the 2.15
crore shares in the promoter group category of Maytas, the family collectively
held over 1.10 crore shares on that date.
Though Sreedharan has maintained a stoic silence over his allegations on the
Hyderabad Metro project ever since the Satyam fraud came into light, he had in
his letter to the Planning Commission pointed out that, while the state
government was citing the Metro as a successful example of BOT approach, it
wasn't really so.
"I would like to caution that the example of the Hyderabad Metro (as a
successful example of BOT approach) is quite misleading as the negative
viability gap funding has resulted solely on account of 296 acres of prime land
being made available to the BOT operator for commercial exploitation. This is
like selling family silver," he had said in his letter.
He went on to caution that the project may lead to "a big political scandal some
time later", alleging that Maytas "has a hidden agenda which appears to be to
extend the Metro network to a large tract of his private land holdings so as to
reap a windfall profit of four to five times the land price."
Following his objection, the DMRC, project consultant for the Hyderabad Metro,
pulled out of the project. There were also reports suggesting that the detailed
project report prepared by DMRC had been "altered" to give benefits to the BOT
operator which had procured large chunks of land around the Metro route.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 01/11/2009 : 18:33:08
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Rajasekhara Reddy announces second probe into capability of Maytas Infra
HYDERABAD: Andhra Pradesh Chief Minister Y. S. Rajasekhara Reddy had to eat his own words at a press conference here on Sunday when he announced a second inquiry in four days by the Chief Secretary into the capability of Maytas Infra to execute projects worth thousands of crores of rupees in the irrigation and other sectors.
On New Years Day, that is two weeks after then Satyam chairman B. Ramalinga Raju created a stir in the corporate sector by announcing acquisition of Maytas Properties and Maytas Infra, Dr. Reddy batted for the group when he said, Satyams problems have nothing to do with us. These, he asserted, were purely internal problems and announced there was no proposal to review the agreement with Maytas for execution of the Hyderabad Metro Rail project, one of the biggest projects of its kind in the country in the public-private partnership mode.
When Dr. Reddy made this statement, the reputation of Satyam Computer had already taken a beating following the World Banks decision to debar the IT major for providing improper benefits to Bank staff and for failing to maintain documentation to support fees charges for its sub-contractors. The Bank had also alleged that Satyam indulged in data theft while doing business with it for eight years.
The magnitude of the crime changed completely on January 7 when Mr. Raju confessed to defrauding the company to the tune of Rs.7,000 crore. Dr. Reddy, who was in New Delhi attending a conference of Chief Ministers, said he had asked the CID to launch a preliminary inquiry and Chief Secretary P. Ramakanth Reddy to review the gamut of projects.
By then, a proper response from the government was of paramount importance since Maytas Infra, which virtually enjoyed a most favoured company status, was executing projects, either on its own steam or in consortia, whose cumulative cost was close to Rs.30,000 crore. These projects are in sectors such as irrigation, metro rail, deep sea water port and power.
Dr. Reddy said on Sunday that the Chief Secretary had found no irregularities in the allotment of the Metro Rail Project, the Machilipatnam Port and various irrigation projects to Maytas.
Transparent process
He said the bids were finalised in a transparent manner in the presence of State and Central government officials. Yet, he had asked the Chief Secretary to once again verify whether Maytas had the capability to complete the ongoing projects and the financial strength to launch the new ones. If it did not, the government would evaluate the situation and explore available options to ensure their completion on time.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 01/13/2009 : 21:18:45
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Online edition of India's National Newspaper
Wednesday, Jan 14, 2009
ePaper | Mobile/PDA Version
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Hyderabad Metro Rail now faces an uncertain future
It haas may find it tough to raise the debt and equity component
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Sources: raising even Rs. 100 crore will be difficult
Nothing likely to happen till middle of next year
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HYDERABAD: The elevated metro rail project for the twin cities is doomed. With the Maytas-led consortium, the selected developer, facing a bleak future following the Satyam Computer Services scandal, there is little chance of the project taking off.
While the government claims to be reviewing the consortiums capability to take up the project under the public, private partnership (PPP) mode, it is now clearly waiting for Maytas to blink first. The other option is to wait till the financial closure on March 18 when Maytas not only has to pay a performance guarantee of Rs. 180 crore, but also show its funds inflow and outflow to build the metro rail.
Financial closure would mean that the consortium has to show its equity around Rs. 4,000 crore and a debt component of Rs. 8,000 crore (1:2 ratio) to be raised from financial institutions. Considering the unfolding financial fraud involving Satyam, Maytas could find it extremely difficult to raise the debt and equity component as it is headed by Teja Raju, son of B. Ramalinga Raju, former chairman of scam-hit Satyam.
It will be very difficult to raise even Rs. 100 crore for the consortium after the Satyam imbroglio, affirm official sources.
Penal clauses
The government seems disinclined to cancel the deal unilaterally considering penal clauses in the Concessionaire Agreement signed with the consortium of Maytas, Navabharat Ventures, Ital Thai and IL&FS. With general elections notification expected soon, nothing is likely to happen on this front till the middle of next year.
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Andhra Pradesh
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irse
Forum Admin
India
553 Posts |
Posted - 01/16/2009 : 07:24:48
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ttp://www.ndtv. com/convergence/ ndtv/story. aspx?id=NEWEN200 90080162& ch=1/15/2009% 206:14:00% 20PM
Thursday, January 15, 2009, (Hyderbad)
"The seriousness with which they are working, I don't see any problems in the financial closure.''
Thus spoke N V S Reddy, MD of Hyderabad Metro Rail, just a few days before Ramalinga Raju dropped the bombshell on 7th January and sent Satyam's reputation on a downward spiral.
Sources in the government have told NDTV that the rail project's financial closure is unlikely to take place in March. Maytas was to pay 180 crore rupees as performance guarantee in March. But the government now has serious doubts over Maytas's financial muscle.
Sources say that the final decision will be a political one on when, how and whether Maytas will be told to abdicate the 12000 crore rupees project. Rebidding would be a loss of face also for the government that's already been accused of favouritism in granting the deal to Maytas consortium in the first place.
The government has already indicated that under no circumstances will it abandon the high-profile project. Andhra Chief Minister Y S Rajasekhara Reddy says: "Ultimately the interest of the work will have to be projected. If Maytas consortium cannot do this work or if there are clouds on Maytas, we will have to find ways and means how to do it in a very transparent way.''
The government admits the project has become very messy, quite unlike the elevated travel experience it promises to its passengers. The effort now is to ensure it is somehow put back on track.
irse |
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 01/16/2009 : 19:26:57
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http://www.business-standard.com/india/news/maytas-may-lose-hbad-metro-project/00/08/346304/
Hyderabad January 16, 2009, 0:05 IST
Even as the Satyam’s financial fraud case is acquiring a political hue, the
Andhra Pradesh government is now studying alternatives, including calling fresh
bids or replacing the consortium partners, for the Rs 12,000-crore Hyderabad
Metro Rail project.
A senior official privy to the happenings about the Satyam and Maytas issues
told Business Standard on condition of anonymity, “The government will not
back off from terminating the contract with Maytas if it did not achieve the
required legal milestones as agreed.” These come into picture if the
Maytas-led consortium, comprising Nava Bharat, Ital Thai and IL&FS, fails to
achieve financial closure for the project by March 2009.
Satyam founder Ramalinga Raju and his family own a little over 36 per cent stake
in Maytas Infra — a listed entity run by B Teja Raju, the elder son of
Ramalinga Raju. It is also learnt that the government is reaching out to the
other consortia, which lost the metro rail project to the Maytas-led consortium.
However, for a new proposal, the government might need to provide the viability
gap funding as estimates would be revised.
When asked if there are efforts to disengage Maytas from the metro project in
view of the current developments at Satyam, NVS Reddy, managing director of
Hyderabad Metro Rail Corporation, the nodal agency implementing the project,
said, “It is up to the government to take a decision on this issue.’’
Four consortia made the financial bids for the Hyderabad Metro Rail project,
which were opened in July 2008. The Essar-led consortium, the highest bidder,
sought a Rs 3,100 crore grant. The Reliance Infra-led consortium, the
second-highest bidder, sought Rs 2,811 crore, while Magna Allmore-led consortium
sought ‘zero’ grant and offered a negative viability gap funding of Rs 152
crore (to the government).
The Maytas-led consortium offered to pay Rs 30,311crore over 35 years of the
concession period. When discounted at 13.5 per cent prime lending rate, the net
present value worked out to Rs 1,240 crore. Maytas had presented a Rs 150-crore
cheque to the state government when the project was awarded to them.
It is estimated that about 1.6 million passengers would use the metro rail in
2011 and 2.6 million per day by 2021.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 01/16/2009 : 19:44:20
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http://timesofindia.indiatimes.com/Hyderabad/Congress_has_killed_metro_rail_project_/articleshow/3985997.cms
16 Jan 2009, 0011 hrs IST
HYDERABAD: The TDP, TRS and the two Left parties on Thursday charged that the
Congress state government has killed the Hyderabad metro rail project
by favouring Maytas Infra and giving a contract worth Rs 12,500 crore to them.
At a joint press conference, N Chandrababu Naidu, K Chandrasekhar Rao, K
Narayana and B V Raghavulu said the government had deliberately sidelined Delhi
Metro rail corporation MD E Sridharan from his post of consultant since he was
opposed to the awarding of the project to Maytas. They said Sridharan had
expressed reservations over the way the government had awarded contracts to the
Maytas-led consortium and questioned how a private consortium could exploit
prime private land for the purpose.
Echoing Sridharan, the leaders said giving away 296 acres of prime land to the
Build Operate Transfer (BOT) developer was like selling family silver.
Instead of rectifying the mistake, the government terminated his services as
consultant and even threatened to file defamation case against him. Naidu said
the TDP government had appointed Sridharan as the consultant for the Metro rail
project along with Karnataka and Gujarat governments. While the Metro rail
project in Bengaluru is fast progressing, it has fallen victim to corruption in
AP, the TDP chief charged.
The opposition leaders demanded that the government make a clear statement on
the fate of this project and how it ensure that the works start as per schedule.
Under the present circumstances, it is impossible for Maytas to go in for
financial closure, they contended.
While this being the situation, the CS is learnt to have given a clean chit to
Maytas and chief minister Y S Rajasekhara Reddy says that the metro rail project
would go as per schedule. The opposition parties said they would raise this
issue during election on account budget session of the state assembly in
February.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 01/19/2009 : 08:52:18
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http://inhome.rediff.com/money/2009/jan/19-why-wasnt-anyone-listening-to-metroman-sreedharan.htm
January 19, 2009
Follow the money.' Thus runs the classic line from the Oscar-winning film All the President's Men, based on the account of how two reporters brought down President Richard Nixon.
In the film the line is attributed to a man known only as 'Deep Throat', whose tips helped Washington Post reporters Bob Woodward and Carl Bernstein to uncover the Watergate scandal. It was, and still is, excellent advice, for any investigator. And I hope it will be applied to the ongoing Satyam [Get Quote] scandal.
But which money? Right now the focus seems to be on the 'non-existent' thousands of crores that Ramalinga Raju, former supremo of Satyam, wrote about in his now famous resignation letter. Various amounts are being bandied about, from Rs 5,000 crore (Rs 50 billion) to Rs 7,000 crore (Rs 70 billion). But Ramalinga Raju's family was involved in another potential scandal, one amounting to a reathtaking Rs 12,132 crore (Rs 121.32 billion).
The story begins in the second or third week of September 2008 when
Ellatuvalapil Sreedharan wrote a letter to the Planning Commission, in which he was highly critical of the Hyderabad Metro project. E Sreedharan is no unknown, he is the technocrat who pulled off the Konkan Railway and then the Delhi Metro projects among other engineering projects, someone lauded for his work both in India and abroad.
Sections of Sreedharan's letter to the Planning Commission found their way into the media. Sreedharan, who had been asked to serve as a consultant for the Hyderabad Metro project, remarked that making 'available 296 acres of prime land to the BOT [build, operate and transfer] developer for commercial exploitation was like selling the family silver.' Saying he feared a 'big political scandal
some time later,' he added, 'It is apparent the BOT operator has a hidden agenda which appears to be to extend the metro network to a large tract of his private land holdings so as to reap a windfall profit of four to five times the land price.'
How is this connected to Satyam? Because the BOT operator mentioned by ESreedharan in his letter was Maytas Infra, controlled by the Raju family of Satyam infamy and run by Ramalinga Raju's son Teja. It was, as you may recall,Ramalinga Raju's aborted attempt in December 2008 to buy Maytas Infra and Maytas Properties that set off the chain of events that brought him down less than a month later.
Was Sreedharan being a little optimistic if he thought that putting his objections in writing would lead to a rethink? It has been reported that the Planning Commission, which is run by Dr Manmohan Singh's hand-picked nominee Montek Singh Ahluwalia, criticised Sreedharan for not backing up his allegations with facts. That report may or may not be true -- it would be interesting to go
through the Planning Commission's records to ascertain the truth -- but it is certainly a fact that the Planning Commission did not order a second look at the Hyderabad Metro project.
And the response of the government of Andhra Pradesh is definitely on record. In November 2008, Finance Minister K Rosaiah, Municipal Administration Minister Koneru Ranga Rao and the managing director of Hyderabad Metro Rail Limited, N V S Reddy, stated at a press conference that they would sue E Sreedharan unless he took back his comments without reservation. They had misjudged their man.
Sreedharan refused to be cowed down by the threat of legal action. It is a little over two months later now and there is no longer any talk of suing E Sreedharan.
Given the Satyam scandal, is it too much to ask that Sreedharan's allegations should finally be taken seriously? And that while we are about it, how about taking another look at all the other BOT projects undertaken by Maytas Infra?
The government of Andhra Pradesh has, for instance, entrusted Maytas with the Rs
9,900 crore Machilpatnam Thermal Power Plant. Another BOT project is the Gautami
Power Project in the state's East Godavari district. Other projects in which
Maytas Infra is involved include the Rs 1,590 crore Machilipatnam Port project,
the Rs 415 crore Cyberabad Expressway, and the Rs 362 crore Hyderabad
Expressway.
It goes without saying that there is absolutely nothing to suggest that there is
anything fishy about even one of these projects. For all we know they could all
be managed with scrupulous honesty. But the fact remains that the unimpeachable
E Sreedharan reportedly made very damaging allegations about one Maytas project,
namely the Hyderabad Metro. It would be prudent, therefore, to run a quick scan
over all the rest.
This may be necessary in any event. The unwinding of the Satyam scandal has
taken a toll on Maytas Infra as well, and its stocks have been hammered. One
year ago, Maytas Infra was quoted on the BSE at Rs 840; as I write the price has
fallen to Rs 117.
Maytas Infra was supposed to give the government of Andhra Pradesh Rs 180 crore
as a performance guarantee in the Hyderabad Metro project in March 2009. Given
the manner in which its fortunes are sinking it is open to question if the
company can raise the money.
Will any bank lend it the funds? If not, how about the money it needs to operate
other projects?
Maytas Infra's connection to the Hyderabad Metro Project may well be a thing of
the past but how did Maytas become such a force to reckon with in the first
place? The brief excerpts of Sreedharan's letter that were leaked speak of a
'political scandal' based on real estate dealings. It is time that they
Sreedharan's misgivings were taken seriously and a full investigation was put in
place. If the Rs 7,000 crore Satyam scandal is being probed so too should the Rs
12,132 crore Hyderabad Metro project.
It beggars belief even now that neither the Planning Commission in Delhi nor the
Government of Andhra Pradesh took a man of E Sreedharan's eminence seriously.
Mark Felt, then associate director of the FBI, was forced to operate anonymously
as 'Deep Throat;' E Sreedharan was ready to talk openly but nobody was willing
to listen.
Ironically, our beloved neighbours in Pakistan were far more eager to tap into
Sreedharan's expertise, and invited him to inspect the viability of the Lahore
Metro. Perhaps the Pakistanis were just recognising how much better we Indians
are when it comes to economic matters, whether in construction or in
destruction.
A single Sreedharan may be better than 10 Pakistani technocrats, and 10
Pakistani terrorists let loose in Mumbai could not wreak as much financial
damage as a single man, Ramalinga Raju!
Mon Jan 19, 2009 2:13 pm
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 01/29/2009 : 06:31:00
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Metro rail debate begins
http://www.expressbuzz.com/edition/story.aspx?
Title=Metro+rail+debate+begins&artid=SVgs80Rp9hg=&SectionID=e7uPP4%
7CpSiw=&MainSectionID=fyV9T2jIa4A=&SectionName=BUzPVSKuYv7MFxnS0yZ7ng
==&SEO=
HYDERABAD: Metro rail or MMTS-BRTS, which suits Hyderabad better?
The debate seems to have started all over again following the recent
developments which have cast a shadow on the future of the Hyderabad
Metro Rail project.
Touted as the biggest such project in the world taken up on public-
private partnership (PPP) model, the Rs 12,132-cr Hyderabad metro
rail looks almost derailed by the Satyam fiasco.
Maytas Infra, a partner in the consortium which was awarded the
metro rail project, is owned by Teja Raju, son of scamtainted former
Satyam chief Ramalinga Raju.
The firm is now under investigation for its possible role in the
Satyam fraud and it is likely that the government may cancel the
deal. Even otherwise also, the consortium has to achieve financial
closure by March and pay Rs 150 cr to the government as per the
agreement, which appears unlikely in the current scenario as raising
funds will be no less than a Herculean task for it.
In the circumstances, the government has two options - either to
award the project to the next highest bidder or call for fresh bids,
both of which are fraught with troubles.
Indications are that the government may not go for the first option
as the entire process had become so tainted that it may not be
possible for the government to come out of its shadows completely if
it continues with it. The second option could lead to a huge cost
escalation, and if the blotted PPP model is not to be resorted to,
then it could mean a big financial burden on the government.
But whichever option is adopted delay appears inevitable and the
four-year wait which the Hyderabadis are prepared to endure might
get extended indefinitely.
Then is this the right time for the government to take a relook at
the entire system and consider a long ignored option which can be
both less expensive and less time-consuming? The proposal, of a
combination of Multi Modal Transport System (MMTS) and Bus Rapid
Transit System (BRT S), has been afloat for quite sometime, but the
voices of its proponents are becoming increasingly strident now,
following the latest fiasco.
"The government should scrap the Metro Rail project and instead
develop the existing MMTS and combine it with BRT S for a better,
cost-effective mass urban transport system," says C Ramachandraiah
of Citizens for a Better Public Transport in Hyderabad (CBPTH), the
chief proponent of this model.
The organisation held a press conference here recently and
forcefully put forth its demand for a CBI probe into Maytas deals
alleging a collusion between the government and the company.
Asked why not we emulate the successful Delhi Metro model, he shoots
back, "Hyderabad is not Delhi." Mass transit models should be city
specific, and the MMTSBRT S model suits the conditions of the city
better than the metro rail.
With one phase of the MMTS already operating successfully, what is
needed is implementing the other phase and developing the BRT S
which is very cost-effective at Rs 12- 17 cr per km against Rs 169
per km required for Metro rail, he avers.
In fact, the metro has been finalised without proper discussions in
public fora and ignoring many important issues. Many people are
unaware that some important junctions like Lakdi-ka-pul have been
left out of the metro route, he complains.
It's not money but a strong political will that is required to
implement the alternative model, he feels.
For the combined model the first thing that is needed is a proper
coordination with railways. The phase two of MMTS due to be
completed in 2005 has to be taken up immediately.
Parallel tracks to the existing lines have to be laid to improve the
frequency of trains. Bus connectivity to stations has to be improved
and a single ticket system for both bus and MMTS journey ensured.
Rail lines have to be laid to unconnected areas like Malakpet and LB
Nagar at the underground, surface or elevated level depending on the
need. For short distances like 4-5 km people always prefer buses to
trains. So a dedicated BRT S, complementing the MMTS with a single
ticket system is expected to provide a robust, convenient and cost-
effective public transport.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 02/21/2009 : 21:03:31
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Hyderabad Metro on bumpy track
Hyderabad : Hyderabad Metro Rail Project has become uncertain after the Centre decided to take over the Maytas firms. Maytas Infrastructure Limited, headed by Mr Teja Raju, elder son of Mr B Ramalinga Rajuhad bagged the INR 12,132 crore project last August. The Maytas consortium's model of public private partnership was dubbed by the Andhra Pradesh Government as innovative and unique based on a design, build, finance, operate and transfer of the 71 kilometer long metro rail. The consortium comprises Navabharat Ventures Limited, Maytas Infra Limited, Italian-Thai Development Public Company Limited and Infrastructure Leasing and Financial Services Limited. Though, the consortium is still intact, Maytas Infra was finding it hard to achieve financial closure. an official of Hyderabad Metro Rail said that "The state Government felt that Maytas had time till March 31st to achieve financial closure but the firm is in trouble after Ramalinga Raju revealed the Satyam fraud. Now that the Centre has taken over, the project becomes uncertain because it will take time to complete the legal formalities to hand over to a new boardto be appointed by the Centre."The project had courted controversy right from the beginning. Mr E Shreedharan MD of the Delhi Metro Rail Corporation had expressed reservations and doubts over the viability of the project. As per Maytas model, the Andhra Pradesh Government didn't have to spend a single penny on the project. Instead, the Maytas Metro Limited which would have spent INR 12,132 crore to build the elevated metro rail would also have paid the Government for being allowed to execute the project. Over the 35 years concession period of the project, Maytas would pay the state INR 30,311 crore asa payback, INR 11 crore on signing of the agreement, INR 50 crore on achieving financial closure, INR 200 crore in the 4 year, INR 100 crore a year from 7 to 9 year and, INR 1,750 crore from 18th to 34th year. The Maytas hoped to generate its revenues by developing prime real estate and leasing space for commercial use along the elevated project, at stake was nearly 18 million square feet of virtual space or 269 acres available at 66 stations and three depots along the 71 kilometer metro rail. Maytas planned to develop shopping malls, multiplexes, residential apartments, office spaces etc within the applicable laws, and give them on lease. (Sourced from Express News Service)
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 03/17/2009 : 20:35:47
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Maytas seeks more time for Metro Rail financial closure
http://www.newspostonline.com/world-news/maytas-seeks-more-time-for-metro-rail-financial-closure-2009031741716
Hyderabad, March 17 (IANS) Maytas Infra Ltd, a company owned by the family of
former Satyam Computers chairman B. Ramalinga Raju, Tuesday sought more time for
achieving financial closure for Rs.122-billion (Rs.12,200 crore) Hyderabad Metro
Rail project.
The infrastructure firm has requested the Andhra Pradesh government to grant it
extension of time to achieve the milestones mentioned in the concession
agreement, which include achievement of financial closure.
“The global recession and the consequent credit squeeze in national and
international capital markets have created a force majeure situation. Besides,
the ongoing PIL (public interest litigation) is having an extremely deleterious
effect on our ability to achieve the financial closure,” the company told the
government.
In the PIL filed in the court a non-governmental organisation has challenged the selection of Maytas-led consortium for the project.
“We are also affected by the global recession, and raising of debt (including external commercial borrowings) is proving to be a challenge in this market,” said a company spokesman.
The financial closure for the project is to be achieved this month as per the concession agreement signed in September last year.
Maytas came under cloud after Ramalinga Raju in January this year admitted Rs.78-billion (Rs.7800-crore) fraud in Satyam. There are allegations that he diverted the money to Maytas owned by his son B. Teja Raju, but Maytas has denied it.
Despite demands from various quarters for scrapping Metro Rail and other projects awarded to Maytas, the Andhra Pradesh government has refused to do it without sufficient grounds.
The government had hinted that it might cancel the Metro Rail project if the consortium failed to achieve financial closure.
The Maytas-led consortium holds 52 percent and the state government 16 percent equity in the project. Within the consortium, Maytas holds 26 percent,Navabharat 16 percent, Ital Thai (Thailand) 5 percent and IL&FS 5 percent.
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Maytas Infra seeks 6-mth extension for Metro Rail financial closure
http://www.business-standard.com/india/news/maytas-infra-seeks-6-mth-extension-for-metro-rail-financial-closure/56791/on
Hyderabad March 17, 2009, 19:28 IST
Maytas Infra Limited, promoted by the family of beleaguered Satyam Computer
Services founder B Ramalinga Raju, has sought extension of time to achieve financial closure for the Rs 12,132-crore Hyderabad Metro Rail Limited (HMRL) project. The consortium was to achieve financial closure for the high-profile project today.
Having sought an extension, it will now have to deposit Rs 240 crore bank guarantee and get a 60-day breather by paying a penalty for achieving the financial closure. "I am yet to get full details if Rs 240 crore performance guarantee has been deposited or not,'' the company spokesperson said.
"The global recession and consequent credit squeeze in national and
international capital markets has created a Force Majeure (a common clause in contracts which essentially frees both parties from liability or obligation when faced with an extraordinary event) situation. Besides, the ongoing PIL (public interest litigation) is having an extremely deleterious effect on our ability to
achieve the financial closure," the company stated in a press release.
The PIL was filed by the Forum for Better Hyderabad, a non-government
organisation, saying the project would affect the aesthetics of the city. "We
are also affected by the global recession, and raising of debt (including ECB)
is proving to be a challenge in this market," a company spokesperson said.
HMRL chairman CVSK Sarma said Maytas had asked for six months' time. "We will examine their request and also study the legal aspects involved in it,'' he said. On the penalty to be slapped on Maytas, he said it was too early to comment on it. Earlier, HMRL managing director NVS Reddy had said the decision on the project vested with government. "HMRL is only a facilitating agency,'' he
pointed out.
The 71.6-km long metro rail project is envisaged to be executed on a build, operate and transfer (BOT) basis in a public-private partnership with the government's contribution predominantly being land. The government had issued the letter of acceptance for the project in August last year. HMRL, a special purpose vehicle, was formed to implement the elevated metro rail project in four
years.
Five consortia qualified for the bids but one (the GVK-led consortium) did not participate in the bidding. The bid was called for Rs 12,132 crore including Rs 318 crore state taxes component. A three-member committee, in which HMRL managing director NVS Reddy is a member, recommended the Maytas consortium comprising Nava Bharat Ventures Limited, Italian-Thai Development PLC and IL&FS
for the metro rail project.
In fact, Andhra Pradesh chief minister YS Rajasekhara Reddy had been doubtful
over the Maytas Infra-led consortium achieving financial closure by March 17.
"Maytas had bid for the project when there had been a boom in real estate.
Given the current situation on the real estate front, I don't think that banks
would come forward liberally to finance the project," he had earlier said.
On the other hand, Maytas had earlier maintained it was on course to achieve financial closure and its partner IL&FS was tying up the finances. As per the bid agreement, the project was to be grounded within six months after it was awarded to the Maytas consortium in September last year. Maytas had already paid Rs 11 crore to the government at the time of agreement. It was to pay Rs 50 crore on financial closure and furnish Rs 240 crore bank guarantee as
performance security by March 17.
The Maytas consortium did not seek any viability gap funding from the government and committed to pay Rs 30,311 crore to the government during the 34-year concession period for the project. The contribution by Maytas Infra to the government during the concession period brought to present value was Rs 2,463 crore. Another bidder, Magna Allmore, committed to contribute Rs 250 crore to the government through equity contribution in 2011 and 2013 (present value Rs 171 crore). Two other bidders - Essar and Reliance-led consortia sought a viability gap funding of Rs 3,100 crore and Rs 2,811 crore respectively.
Other than ticket fares, it proposed to build real estate property for leasing to make the metro rail project financially sustainable. Three depots - at Miyapur (100 acre), Nagole (100 acre) and Falaknuma (17 acre) - have been proposed and malls and commercial complexes would come up at these depots. In all, there would be 66 stations and about 50 per cent of them are to be built to
support commercial activities. All these would have to be transferred to the government after the concession period expires. As many as 78 trains would ply on three sectors at a five-minute interval.
Earlier, consortium member Nava Bharat Ventures Limited informed that it had not undertaken any liability concerning the project nor had it any subsisting investment in the project. The company did not wish to speculate on the likely moves of the government concerning the project.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 05/05/2009 : 10:58:31
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Maytas Infra seeks time for tying up funds for Hyderabad Metro http://www.business-standard.com/india/news/maytas-infra-seeks-time-for-tyingfunds-for-hyderabad-metro/60517/on
New Delhi May 5, 2009, 14:26 IST
Confident of reviving the beleaguered Maytas Infra, company Chairman K Ramalingam today said the firm has sought six more months from the Andhra Pradesh Government to arrange finances for the prestigious Rs 15,000-crore Hyderabad Metro project.
The company, promoted by the kin of Satyam Computer's founder Ramalinga Raju, was originally scheduled to go for financial closure of the project by mid-March.
"We see that the company is on a recovery path... Maytas Infra has written to the Andhra Government for the extension (of the financial closure in metro project)," Ramalingam told reporters here.
Ramalingam did not rule out the possibility of stake sale, even though the company does not need a strategic partner as of now.
"We are not ruling out stake sale in future. We are not foreclosing any option as regard stake sale in future but right now we don't see (the need for) any strategic partner; we are focusing on a revival plan," he said.
On the revival plan, the Chairman said the company has an outstanding debt of approximately Rs 1,700 crore and an order book of more than Rs 8,500 crore, apart from the Hyderabad Metro Rail Project, worth Rs 15,000 crore.
Ramalingam said the order book has shrunk due to the global financial meltdown and developments in the wake of the disclosure of fudging of accounts in Satyam Computer.
"We have interacted with senior executives and we have been finding ways as to how to revive the company. The company has very good professionals, it can be revived, we have started evaluating the projects," he said.
He said the company has formed four committees which will focus on their respective areas of project management, audit, banking, finance and legal.
"We have done draft plans for restructuring and we have started meeting the customers to assure them," he said.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 05/07/2009 : 10:16:52
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Maytas to seek waiver on penalty to be paid
http://www.expressbuzz.com/edition/story.aspx?Title=Maytas+to+seek+waiver+on+penalty+to+be+paid&artid=y%7CwmSvDDP10=&SectionID=e7uPP4%7CpSiw=&MainSectionID=fyV9T2jIa4A=&SectionName=EH8HilNJ2uYAot5nzqumeA==&SEO=
07 May 2009 12:22:22 PM IST
HYDERABAD: Maytas Infra Ltd., which bagged the Rs 12,000-crore Hyderabad Metro Rail Project, is believed to be seeking a waiver on the penalty to be paid for failing to achieve the financial closure. As per the Memorandum of Understanding (MoU) signed between the Government of Andhra Pradesh and Maytas, the later is expected to pay Rs 24 lakh per day as penalty, in case if it fails to achieve
financial closure within the stipulated time of 180 days after awarding the project on September 19, 2008.
Maytas’ newly-appointed directors who met Ramakanth Reddy, Chief Secretary, last week sought six months time to raise resources. This means, the total penalty to be paid would be to the tune of Rs 43 crore.
resources. ``Considering the extraordinary situations surrounding the company as well as the liquidity crunch in the market, we’ve put in a requisition to borrow additional time and relax some norms,’’ said a senior company official.
Earlier Maytas, the lead partner, had indicated that it would raise Rs 4,000 crore as equity and Rs 6,000 crore as debt from a clutch of private and public sector banks and financial institutions.
It is also expected to furnish a performance security of Rs 240 crore as bank guarantee by March 18, 2009.
In case, if the consortium fails to achieve the financial closure within the set time limit, as per the MoU, it can seek additional time of 60 days, but is expected to pay one per cent of Rs 240 crore -- Rs 24 lakh -- per day as penalty, payable every week as advance to the Government. Sources said, Maytas is yet to pay the penalty amount for the past seven weeks.
“Even if the company achieves financial closure, the penalty can’t be considered as project cost. Neither is Maytas in a position to pay the amount from internal sources and hence must be seeking relaxation from the Government,’’ said an ex-employee.
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S.ravi
Advanced Member
India
4205 Posts |
Posted - 06/12/2009 : 03:12:08
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HYB : Metro Rail project might be delayed
http://www.deccanchronicle.com/hyderabad/metro-rail-project-might-be-delayed-461
June 12th, 2009
Hyderabad
June 11: The Chief Minister Dr Y.S. Rajasekhar Reddy’s strategy on Hyderabad Metro Rail may further delay the project as he mentioned this while replying to the motion of thanks to Governor’s address in the Assembly.
“We are thinking on whether to continue Maytas or offer the project to the company which gave the next best proposal,” he told members who questioned the delay in implementation of the project. The consortium with Siemens, Emirates Trading Agency, Magna Allmore and Nagarjuna Constructions was the second best bidder.
The Chief Minister’s contention surprised official and nfrastructure circles as both the options were not immediately implementable. The Maytas-led consortium turned down any state assistance and offered to pay to government Rs33,000 crore by end of the lease period after 33 years. The second consortium also refused to avail any Viability Gap Funding but offered to pay Rs 240 crore
within two years from the award of the contract. The high power committee awarded the contract to Maytas as its Net Present Value is Rs 1,600 crore against Rs 240 crore.
Sources informally said the second consortium developed cold feet after the Satyam-Maytas fiasco. “We find our own offer unviable in the present scenario of economic slowdown,” said a director of one of the consortium partners. The consortium partners were also believed to have not shown any enthusiasm.
Officials involved in the project also feel that it would be difficult for the government to explain why it awarded the contract to a company which offered to pay less. On the other hand the government has been delaying cancelling the agreement with Maytas-led consortium though the Law department gave its clearance.
“It is doubtful whether Maytas can pull along even after giving time,” an official said. He further added that the CM suggested the Tamil Nadu model of executing the project with financial assistance from Japanese Bank of International Cooperation and availing Rs 4,000 crore Viability Gap Fund from the Centre was better.
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Hyderabad metro news
