VA Tech Wabag completes financial closure of second HAM project
Water technology major VA Tech Wabag has completed the financial closure of its second hybrid annuity model (HAM) project received under the ongoing Namami Gange programme. The Chennai-based company signed financing agreements for developing sewage treatment plants and sewerage network for Digha and Kankarbagh zones of Patna, Bihar with PTC India Financial Services Limited (PFS), a leading green infrastructure finance company.
The scope of the project includes development of sewage treatment plants of 150 MLD capacity along with sewerage network of over 453 km in Digha and Kankarbagh zones.
VA Tech Wabag has secured the first-of-its-kind design, build, operate and transfer (DBOT) and hybrid annuity model (HAM) project. The Rs 1187-crore contract was secured from Bihar Urban Infrastructure Development Corporation (BUIDCO) under the National Mission for Clean Ganga Scheme to develop STPs and sewerage network in Digha and Kankarbagh zones of Patna, one of the most populous cities on the banks of Ganga.
VA Tech Wabag will execute engineering, procurement and construction (EPC) portion of the sewage treatment plant under the HAM project over 24 months followed by peration & maintenance (O&M) of the infrastructure for 15 years. The STPs will produce renewable energy from biogas to run the plants leading to lower operational expenses.
The project comprises of a design, build and operate (DBO) scope worth Rs 940 crore and Hybrid Annuity Model (HAM) scope worth around Rs 247 crore. The EPC portion of the HAM scope is to be funded through a mix of NMCG grant, equity and debt – as much as 40 per cent of the amount will be funded by the NMCG grant during construction period and balance 60 per cent will be funded by a mix of debt and equity.
“It is yet another proud moment for Wabag to achieve financial closure of second HAM project in succession under current context in the country. We are happy to have PFS as our partner for financing the debt portion of this project”, said VA Tech Wabag Director & Chief Growth Officer and Head of Capital Projects S Varadarajan.
VA Tech Wabag has partnered with PFS to meet the project debt funding requirement. PFS provides a vast array of services to the entities in infrastructure sector while contributing to the sustainable development goals of the country. PFS extends debt/mezzanine/bridge finance to projects in renewable power generation, transmission, distribution, road HAM/annuity projects, sewage treatment projects, water supply projects, e-mobility projects towards financing sustainable green infrastructure projects and other economic strategy sectors.
“PFS, with this debt funding to the STP project of VA Tech Wabag re-affirms its commitment to support upcoming environment friendly green infrastructure projects in the country”, said PTC India Financial Services Limited (PFC) MD & CEO Dr Pawan Singh.
