The Hindu Business Line : IL&FS ties up funding for road project in Thiruvananthapuram

IL&FS has announced that it had tied up funding for the Thiruvananthapuram Road Development Company (TRDC) that had been set up to develop the Thiruvananthapuram Capital Region.

An IL&FS press release said the project cost is expected to be Rs 220 crore, and its debt-equity ratio would be 3:1.

A consortium of banks led by Punjab National Bank participated in the funding. Among other participating banks were Bank of India and Indian Overseas Bank.

TRDC's equity is evenly divided between two companies, Consolidated Toll Network Ltd (CTNL) and Punj Lloyd. CTNL was promoted by IL&FS in 2001 to carry out specialised services in infrastructure projects.

The CTNL President & CEO, Mr K. Ramchand, said the Kerala Government would pay for the project through an "annuity."

He added the first payment would come three years after the agreement (already signed between the Government and TRDC). The payments are to be spread over the next 15 years.

Mr Ramchand said, "This is the first urban road project being undertaken through private sector participation."

The Kerala Government had enacted the Kerala Road Fund Act, 2001, to finance road projects.

Mr Ramchand said the Government had earmarked a portion of its receivables for the road fund, the first instance when a State Government has decided channel a part of its receivables only for road projects.

The IL&FS press release said CTNL and Punj Lloyd had earlier formed a consortium, and successfully bid for the road project.

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