NCLT Disposes Insolvency Petitions Against Mumbai Metro One

The bankruptcy court disposes Section 7 petitions of SBI and IDBI Bank due to a one-time settlement
NCLT Disposes Insolvency Petitions Against Mumbai Metro One
Source: Mumbai Metro One

India’s National Company Law Tribunal (NCLT) disposed of insolvency petitions of State Bank of India (SBI) and IDBI Bank against Reliance Infrastructure Ltd.’s joint venture Mumbai Metro One Private Ltd.

The NCLT’s Mumbai bench disposed of the Section 7 petitions of SBI and IDBI Bank against Mumbai Metro One in view of a one-time settlement issued by all lenders, Reliance Infrastructure said in a stock exchange announcement.

Mumbai Metro One, a joint venture between Reliance Infrastructure and the Mumbai Metropolitan Region Development Authority (MMRDA), operates the metro line from Versova to Ghatkopar in India’s financial capital Mumbai.

Reliance Infrastructure owns a 74% stake in the metro line operator, while the remainder is held by MMRDA, an apex body for planning and co-ordination of development activities in Mumbai and its surrounding areas.

The latest development comes after MMRDA last month told the bankruptcy court that the Maharashtra state government plans to settle the dues of Mumbai Metro One’s lenders.

The Maharashtra state government’s cabinet previously gave an in-principle nod for the acquisition of Mumbai Metro One, which was staring at insolvency proceedings.

Reliance Infrastructure earlier said the total principle debt of the lenders’ consortium in Mumbai Metro One was 1,711 crore rupees ($205 million).

In January, Indian Bank filed an insolvency petition against Mumbai Metro One, following similar petitions by SBI and IDBI Bank previously against the company.

Mumbai Metro One was first dragged into the insolvency proceedings by SBI in August 2023 to recover about 416.08 crore rupees. A similar petition was filed by IDBI Bank against the rapid transit system operator in October for recovery of about 133.37 crore rupees.

The Versova-Andheri-Ghatkopar corridor, a mass rapid transit system project, was awarded by MMRDA through a global competitive bidding process on public-private-partnership framework to Reliance Infrastructure-led consortium in 2007. Later, a special purpose vehicle, namely, Mumbai Metro One, was incorporated for the implementation of the project.

This was the first metro project in the country financed by Indian banks, according to Mumbai Metro One’s website. The project was financed by a consortium of banks, led by Syndicate Bank, Indian Bank, State Bank of Hyderabad, Bank of Maharashtra, IDBI Bank and India Infrastructure Finance Company (UK), it said.

Note: $1 = 83.6092 Indian rupees

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