The Andhra Pradesh government has cancelled the Rs 12,100-crore metro rail project awarded to Maytas Infra Limited, a listed company run by family of Satyam Computer Services Limited founder B Ramalinga Raju.
Announcing this to the media, municipal administration and urban development minister Anam Ramnaryana Reddy said that the government decided to cancel the project as the company had failed to achieve financial closure even after more than three months after the initial deadline in March.
The company bagged the project last year by offering a negative grant to the government. It also rejected the viability gap funding extended by the government and instead offered to give about Rs 30,000 crore to the government over a period of 30 years.
The company chairman K Ramalingam met the chief minister YS Rajasekhara Reddy recently but failed to give any assurance on the financial closure or the performance guarantee.
The minister made it clear that the government would not return Rs 71 crore that the company has paid to the government in phases.
He clarified that the government would still take up the project and would announce a detailed plan on it on July 13.
Maytas recently got its corporate debt restructured but did not mention about any efforts that it was making to achieve financial closure.