MUMBAI: Nandi Economic Corridor Enterprise (Nece) a Kalyani group-promoted company, has achieved its financial closure for the road project stretching from Mysore to Bangalore. The project cost is estimated at Rs 840 crore with the promoters investing Rs 360 crore and the balanced raised from banks and financial institutions.

The project is a part of the mandate received by the National Highway Authority of India to develop 13,146 kilometres of highway, estimated to cost Rs 14,000 crore. This includes the Golden Quadrilateral Project, stretching 5,846 km connecting Delhi-Kolkata-Chennai-Mumbai, and the “North-South-East-West Corridor” stretching 7,300 km connecting Kashmir to Kanyakumari and Silchar to Porbandhar.

For the Nece project, the loan amounting of Rs 480 crore is sanctioned at 13% with Hudco and ICICI Bank likely give Rs 150 crore each and LIC may provide Rs 100 crore. The balance portion will be raised from Punjab National Bank and Bank of India. Sources said that ICICI Bank has arranged the funds for the road project which covers 41 km.

The mandate is based on built-own-operate-transfer basis for a term of 30 years. Kalyani group has formed a special purpose vehicle, Nandi Infrastructure Corridor Enterprise, for this project. Even as the gestation period of the project is 10 years, the repayment will start from May ‘04. Sources said the land parallel to the road would be developed as commercial property.

Promoters have estimated that the property parallel to the road will fetch Rs 140 crore,

besides the road toll which will contribute to the revenue stream, said sources.

So far, NHAI has sanctioned 20 projects worth Rs 1,000 crore. All have been awarded on a BOOT basis.

Under the golden quadrilateral project, a stretch of 1,159 km has already been developed. Another 4,551 km is under implementation with 95 contracts already been awarded for it. For the balance 136 km, four contracts were awarded this year.