July 7, 2009 12:52:37 pm
Andhra Pradesh Government scrapped the Rs 12,000 crore Hyderabad Metro Rail Project on Tuesday. Minister of Municipal Administration and Urban Development Anam Rama Narayana Reddy said that a Cabinet meeting would be held on July 13 to decide whether to go for global re-tendering. For now the project is scrapped. A consortium led by Maytas Infrastructure which was awarded the contract is unable to start the project for various reasons. Other consortia are not interested in taking up the project so we are terminating the contract with Maytas and scrapping the project for the time-being. All agreements between Maytas and government now stand cancelled, the Minister said on Tuesday.
Maytas Infra is the family firm of disgraced Satyam founder B Ramalinga Raju,and is headed by his son B Teja Raju. Maytas,and Hyderabad Metro Rail Project,ran into trouble after B Ramalinga Raju admitted to fraud on January 7 this year.
Maytas Infra was unable to achieve financial closure in March and,as per the agreement providing for a 180-day extension,sought that much time from the state Government. But the state government did not take a decision on that till on Tuesday.
Last August,a Maytas-led consortium had bagged the Rs 12,132 crore project with an innovative business model that not only refused any assistance from the government to execute the project but also proposed to pay the government Rs 30,311 crores in three instalments by the end of the 33 years lease period.
Maytas Infra hoped to generate revenues from the 1 million square feet of virtual space that was available to it along the metro rail including depots and stations. With 26 per cent stake,Maytas consortium partners are the city-based Nava Bharat Ventures Ltd with 16 per cent stake,Infrastructure Leasing and Financial Services Ltd (ILFS) and Thailands Italian-Thai Development Public Co. Ltd,both having five per cent each. The state government has an 11 per cent stake. The project was supposed to be grounded within six months of the contract being awarded.
Last week,Maytas made a desperate bid to rope in new partners by approaching Anil Ambanis Reliance Infra but did not receive any response.
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