RInfra wins Rs 50 bn in DMRC arbitration award, will use funds to pare debt

Delhi HC asks Delhi Metro to deposit Rs 35 bn in an escrow account in four weeks

Reliance Infrastructure won its case against the Delhi Metro Rail Corporation (DMRC) in the Delhi High Court on Tuesday.

Anil Ambani-promoted Reliance Infrastructure said the court has upheld its arbitration award of Rs 29.50 billion as compensation along with interest to Delhi Airport Metro Express Private Limited (DAMEPL), a subsidiary of Reliance Infrastructure Limited (RInfra).

"Reliance Infrastructure stands to get Rs 50.6 billion from the award, which it shall entirely utilize to reduce its consolidated debt. This amount is arbitration award amount plus interest till March 31, 2018," the company said in its statement on Tuesday.

RInfra added the High Court has also directed DMRC to deposit Rs 35.02 billion in an escrow account within four weeks.

The initial arbitration awarded was granted by a three-member Arbitration Tribunal unanimously on the basis of termination provisions of the Concession Agreement, which DAMEPL had utilized to terminate its agreement with Delhi Metro Rail Corporation (DMRC).

DMRC later challenged this award in the Delhi High Court. "The High Court upheld the validity of the award granted by the three-member Arbitration Tribunal,” the company said in its statement.

Rinfra looks to utilize the proceeds from the award to retire its debt. “Now that the Delhi High Court has upheld the award by the arbitration tribunal, we expect the compensation to be paid expeditiously, which we shall utilize to retire the outstanding debt of RInfra and DAMEPL,” a spokesperson for the company said in the statement.