Welspun Corp. Ltd to acquire highway toll project from Essel Grp
New Delhi: Welspun Corp. Ltd will acquire a build-operate-transfer (BOT) highway toll project from the Essel Group.
The subsidiary Welspun Enterprises will acquire the project from Mukarba Chowk-Panipat Toll Roads Ltd. (MCPTRL) This will be done by way of harmonious substitution in which lenders of an incomplete project can transfer the project to another company.
The NHAI and the project’s lenders have approved the substitution, Welspun Enterprises said in a statement.
The Essel Grp subsidiary MCPTRL had already completed a third of the 71.1 kilometer highway from Mukarba Chowk in Delhi, to Panipat in Haryana. The subsidiary has debt of Rs 600 crore.
The project is going to add Rs 1,100 crore to Welspun Enterprises’ EPC (engineering procurement construction) order book, taking it to Rs 4,800 crore.
The total expenditure of the project was estimated to be Rs 2,122 crore. About Rs 1,593 crore is the balance. Welspun will complete the project by June 2021.
Welspun expects to collect Rs 300 crore every year as toll from the project after it achieves commercial operational dates for both sections of the project.
“We believe that this addition to our existing road portfolio will create sustainable value for our shareholders and improve the overall returns for the Company,” said B K Goenka, Chairman, Welspun Group.