on the issue.
The dispute between NHAI, the highway operator and the lenders has been going for over close to two years including several rounds of termination and show cause notices being sent to the developer and the lenders.
DGSCL had earlier placed claims of Rs 988 crore related to the project work, which the government till now has not agreed to.
The understanding between and DGSCL and IDFC comes at a time when both NHAI and highways ministry have refused to entertain any charges being raised by the developer and the lenders. Alleging that the consortium of nine banks led by IDFC had refinanced the project without getting mandatory approval from NHAI, the authorities have termed this as a financial fraud and have also refused to recognize them as lenders. If the court upholds this stand, lenders may end up taking a hit of around Rs 1,400 crore.
Fe was the first to report that the IDFC-led consortium’s to the Delhi-Gurgaon expressway project may land up in jeopardy as its loan agreement does not allow it to substitute DS Construction.
IDFC had sought an approval from NHAI to buy out 74% of the project’s equity — IDFC was to take on the project’s entire debt and buy 74% of DS Construction’s equity for a token R1 in January 2013.
The project has an interesting history, with an initial loan of R383 crore given by a Hudco-led consortium. In January 2009, however, DS Construction had approached NHAI to substitute this consortium with one led by SBI — the loan component was then raised to R1,275 crore. NHAI’s consent was required, since under such concessions, NHAI agrees to pay most of the debt in case a project is terminated.