In October 2012, the Sponsor acquired a 74% equity interest in MITPL, a Project SPV incorporated to expand a 41.575 km section of NH 7 from Salem to Namakkal in Tamil Nadu from two lanes to four lanes and to improve, operate and maintain a 7.85 km section of NH 7 from Omalur to Salem in Tamil Nadu, in each case on a BOT basis pursuant to a concession agreement dated February 16, 2006 between MITPL and the NHAI. The remaining 26% equity interest in MITPL has been pledged in favour of the Sponsor and the Sponsor has the right to receive dividends and the authority to exercise voting rights in relation to such equity shares. MITPL and MITPL’s Other Shareholders have applied to the NHAI for consent to transfer the remaining 26% equity interest in MITPL to the Sponsor. In the event the Sponsor acquires such shares, the shares will be transferred to the Trust as part of the Formation Transactions, subject to the receipt of any additional NHAI approvals required in this respect. For further details, please see the section headed “About the Trust – Background and Structure of the Trust – Formation Transactions” in this Draft Offer Document. For risks in relation to such acquisition, please see the section headed “Risk Factors – Risks Related to Our Organization and the Structure of the Trust” in this Draft Offer Document.
The concession agreement contemplates that the NHAI could award additional highway to MITPL for operation and maintenance. On May 7, 2010, the NHAI awarded an additional 19.20 km section of highway to MITPL, in respect of which MITPL is carrying out operations and maintenance services.
As per the relevant concession agreement, the Omalur–Salem–Namakkal NH 7 Project comprises the sections of NH 7 from km 207.05 to km 248.625 and from km 180.00 to 207.05. According to the Traffic Reports, the project features:
• 68.625 km of four-lane carriageway
• 23.58 km of service road
• 14 minor bridges
• 5 flyovers and railway-over-bridges
• 36 culverts
• 8 underpasses
• 16 major intersections
• 1 toll plaza complex