The Telangana government on Thursday regained full control of the Hyderabad Metro project, taking it back from the original concessionaire Larsen & Toubro (L&T), officials said.
According to an official statement, the state government signed a share purchase agreement with L&T and its subsidiary L&T Metro Rail (Hyderabad) Limited (LTMRHL) on Wednesday to acquire 100% shares of LTMRHL at an equity value of 100%. $1,461.47 crores.
The agreement was signed by Hyderabad Metro Rail Ltd (HMRL) Managing Director Sarfaraz Ahmed, L&T Consultant (Development Projects) DK Sen and LTMRHL Managing Director KVB Reddy.
In a separate statement on Thursday, L&T said it has signed an agreement with the state government seeking to sell its entire stake in L&T Metro Rail (Hyderabad) Limited (LTMRHL).
“The divestment represents a value-based monetization of mature infrastructure assets and is in line with L&T’s broader strategy to exit its development project portfolio and unleash capital for redeployment into its core engineering and technology-led businesses,” the statement said.
The Hyderabad Metro project is a world-class asset and a good example of our ability to deliver large-scale infrastructure that transforms cities and improves quality of life,” L&T Chairman and Managing Director SN Subrahmanyan said.
“We are confident that under the supervision of the Telangana government, the project will continue to grow and create long-term value for all stakeholders,” he said.
Under the agreement, the Government of Telangana acquired 100% equity stake in LTMRHL for a total value of Rs $1,461.47 crores. Current debts $13,538.53 crore on LTMRHL, effective from April 30, will be refinanced under the guarantee of the Telangana government, replacing the earlier support extended by L&T.
“IDBI Capital acted as advisor to the deal, while legal advisory services were provided by Saraf & Partners,” the official statement read.
The first phase of Hyderabad Metro Rail has been in operation since November 2017, and is operated by L&T Metro Rail (Hyderabad) Limited. The network extends approximately 69 kilometers across three corridors, making it one of the most comprehensive metro systems in the country.
Currently, the metro system serves about 4.5 lakh passengers daily. Since its inception, it has recorded approximately 8.6 billion passenger trips. “With the state government now in full control, improved coordination between the current Phase 1 operations and the proposed Phase 2 expansion is expected,” the statement added.
