Road operator Cube Highways entered into financial agreements for facilities worth Rs 3,500 crore for its Toll-operate-transfer (TOT) bundle, the company said in a statement on Tuesday.
“Cube Mobility Investments Pte (Cube Highways), part of the Cube Highways group, has entered into financing agreements, through its Indian special purpose vehicles formed for the TOT-3 bundle, with State Bank of India (SBI),” the company said in its statement. It added, the agreement is for availing the term loan facility of Rs 3,500 crore towards the TOT-Bundle 3 projects.
Cube Highways was awarded nine road stretches with 2,265 lane kilometers across various states in India last November, in the third Toll Operate Transfer (TOT) round by National Highways Authority of India (NHAI). Cube Highways emerged as the highest bidder at Rs 5,000 crore. NHAI offers its selected highway stretches to bidders for a onetime, upfront concession fee paid to the government in return for the right to operate, maintain and collect tolls over 30 years.
NHAI’s last two of the three TOT rounds have seen limited success. In 2018, Macquarie won the first bundle of roads in the maiden round. At Rs 9681 crore, many termed Macquarie’s bid aggressive. Interest from bidders soon fizzled out and NHAI cancelled the second TOT round over lukewarm response and lower bids.
Awarded in November, payments due under the third round of TOT is also hit with delays. With COVID 19, according to people the know, NHAI had to allow Cube Highways an extension to make the due payments.
Gautam Bhandari, director of Cube Mobility Investments Pte and managing partner at I Squared Capital said, “We are very pleased to complete a crucial milestone for taking over the TOT-Bundle3 project stretches from NHAI. Achieving this milestone amidst the Covid-19 pandemic reflects Cube Highways’ strong franchise in India and the robust nature of the projects.” In its statement, the company said these project stretches have shown a healthy ramp-up of the traffic after the lockdown was lifted.