Anil Ambani’s team wins Rs6,000 cr bridge project

Anil Ambani’s team wins Rs6,000 cr bridge project
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First Published: Thu, Feb 21 2008. 12 22 AM IST
Updated: Thu, Feb 21 2008. 12 22 AM IST
A consortium led by Anil Ambani emerged as the preferred bidder for building the Rs6,000 crore Mumbai Trans Harbour Link, a 22km six-lane bridge, which will connect Sewri (Mumbai) and Nhava Sheva in Raigad.
The consortium of Reliance Energy Ltd (REL) and Korea-based Hyundai Engineering Construction Co. Ltd, which fought a court battle to stay as bidders for the project, ended up offering the lowest bid to build the sea link by 2013, then recover their costs from the revenues and hand it over back to the nodal agency, the Maharashtra State Road Development Corporation (MSRDC), in just under 10 years.
The only other bidder, a consortium led by Mukesh Ambani-promoted Sea King Infrastructure Ltd, IL&FS Ltd and John Laing Construction Ltd, offered to do the same in 75 years.
The REL-led consortium plans to recover the cost of the project, which is expected to see traffic of 50,000 vehicles each day, through tolls.
Commenting on the relatively low bid, especially when compared to the losing bidder, MSRDC chairman Anil Deshmukh said: “The companies in question would have thought about the financial feasibility before entering their bids. We will scrutinize their business plan and undertake the financial evaluation of the company before we hand the letter of acceptance. We plan to present the letter of acceptance by March.”
Officials from both REL and Sea King declined to comment.
The REL-led consortium had initially been disqualified by MSRDC in mid-2006 on the grounds that consortium partner Hyundai did not meet the requisite financial requirement for bidders as its net worth for 2006 was less then $200 million (Rs800 crore).
There were four pre-qualified agencies for the bids but the consortia led by Indian Farmers Fertilizer Cooperative and Larsen and Toubro Ltd dropped out of the race.
REL then contested its disqualification in the Bombay high court but lost. The Supreme Court, however, in its judgement on 12 September allowed REL to bid for the project.
Work on the project is likely to start by December and will be completed in five years.
When asked whether the sea link would be commercially viable for the bidder, Deshmukh said that a lot of traffic on the Mumbai-Pune route would be diverted to the bridge. The sea link will also ease pressure on the Mumbai-Pune Expressway, National Highway-4 and Mumbai-Goa Highway, where traffic is expected to increase with the new Mumbai international airport and special economic zones. Cars are expected to be charged Rs150 for a one-way trip, while heavy vehicles will be charged Rs250 in tolls.
Deshmukh said that MSRDC will be asking for a Rs130 crore performance guarantee to be kept with MSRDC so that the bidder sticks to the time schedule of five years.
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First Published: Thu, Feb 21 2008. 12 22 AM IST