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Hyderabad: No hanky-panky in Outer Ring Road maintenance tender said Government
Clarifies that the entire tendering process was done transparently and awarded the contract to IRB
Hyderabad : In the wake of allegations of corruption in the finalisation of the bids for the maintenance of the ORR (Outer Ring Road) under TOT (Toll-Operate-And-Transfer) asset monetisation scheme, the State government has clarified that the entire tendering process was done transparently and awarded the contract to IRB Infrastructure Developers Limited.
The State Special Chief Secretary to Municipal Administration and Urban Development Arvind Kumar said that Telangana government had notified the ORR Toll Policy in 2012 in line with the NHAI Toll Fee Rules 2008 which is the basis for determining the toll and its annual increase based on a formula as followed by NHAI. TOT model for NHAI highways was approved by the Cabinet Committee on Economic Affairs.
On August 11, 2022, the State government decided to invite international competitive bids for operation of Outer Ring Road, Hyderabad on TOT basis with a 30 year concession period.
Mazars Advisory LLP, a France-based consulting firm was selected as Transaction Advisors in October, 2022 for the said project based on detailed QCBS-based tendering process.
Mazars was empanelled as Transaction Advisors by Department of Economic Affairs, Government of India for undertaking PPP projects in India (for both Central and State governments).
Mazars advised the HMDA for the said bid for ORR maintenance. On November 9, 2022, HMDA invited international competitive bids for the operation of Outer Ring Road on TOT basis for 30 years. The submission deadline was March 31, 2023, while 11 prospective bidders participated during the bidding stage. Four bids received were found eligible with M/s IRB Infrastructure Developers Limited quoting H1 bid of Rs 7,380 crore.
“This transaction marks one of the largest asset monetization deals in India's road sector, executed by either the central or state government and is one of the best bids finalised for the road infrastructure projects in the country in terms of Revenue Multiple”, Arvind said.
“As per the generally accepted practice for computation of Initial Estimated Concession Value (IECV) for TOT projects, Concession Fee is computed based on the Net Present Value of future free cash flows (i.e. Toll revenue less O&M expenses, Income tax, changes in working capital, interest on short term loan taken, if any, etc) of the Project by discounting with the weighted”, he explained in the release.
