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K.V. Kurmanath

Hyderabad, Aug. 13 As it issued the Letter of Award for the Rs 12,000-crore Hyderabad Metro Rail Project to the Maytas-Nava Bharat Ventures consortium, the Andhra Pradesh Government has reserved the right to get the Golden Share.

A Golden Share is a token Rs 10 share given by the consortia to the governments, giving it a veto right to block moves that might go against the public interest.

The share gives a notional shareholding of 26 per cent to the Government, besides the 11 per cent equity it would have in the prestigious metro project, which could prove to be a money-spinner for the Government, Mr N.V.S. Reddy, Managing Director, Hyderabad Metro Rail Ltd, told Business Line.

The project would get Rs 30,311 crore to the State Government from the consortium, which the industry calls negative grant, for giving the right to construct the metro project.

“This is just a safeguard inbuilt in the agreement in order to protect the public interest. The Government could use this to stop the consortium to shift the headquarters to some place outside the State, alter the provisions of the association or reduce the share capital,” he said.

According to Mr V.V. Rama Raju, Vice-President (Finance), Maytas Infra would have 26 per cent in the project that envisaged laying of three routes with a total length of 71 km. Another Hyderabad-based company Nava Bharat Ventures Ltd would have 27 per cent, while Italian Thai Development Public Company Ltd and IL&FS would have five per cent each.

In all, the consortium would have 63 per cent.

The Government of Andhra Pradesh would have 11 per cent (subject to a maximum of Rs 250 crore). “The balance equity would be arranged for suitably,” Mr Raju had informed the stock exchanges.

According to the timeline of the project, the consortium needs to formalise a concessionaire company within three weeks and sign the agreement in 45 days after the award of LoA.

Mr Reddy said the onus on the Government was to give the right of way and to shift the utilities along the route.

“We are hopeful to begin shifting of utilities by October,” he said.

More Stories on : Railways | Andhra Pradesh

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