The Kerala State Industrial Development Corporation (KSIDC) and the HUDCO signed a memorandum of understanding to harness opportunities in the infrastructure sector in Kerala.
The MoU aims at joint pooling of resources of both the organizations to develop and finance various infrastructure related projects coming up in the state. The MoU was signed in New Delhi by KSIDC managing director Alkesh Sharma and VP Baligar, CMD of HUDCO.
The core areas of the cooperation includes creating a deal flow of infrastructure projects. HUDCO and KSIDC would co-operate in creating a pipeline of infrastructure projects that could be structured along commercially viable lines from a financing perspective, wherever, both parties feel that consortium financing is required.
In such cases, HUDCO would work closely with KSIDC in initial screening and project definition in a manner that withstands commercial and financial scrutiny of potential investors and lenders. HUDCO would also develop and share knowledge reports with focus on identifying business opportunities in infrastructure sub-sectors on an on-going basis.
In credit appraisal, HUDCO and KSIDC would co-operate in undertaking commercial due diligence of short-listed projects and credit appraisal and structuring with the key objective of on-lending by KSIDC in accordance with the scheme for financing of infrastructure projects through KSIDC.
The two institutions would work closely during each stage of the credit review process, including detailed assessment of business and financial plans of the firm/project, due diligence, development and review of risk management plan and delineating security structure, transaction structuring and finalization of term sheet, disbursements and implementation and monitoring.
On syndication of funds and co-financing, HUDCO and KSIDC will work together in developing and structuring, feasible business/financial plan, contractual structure and bankable project structure and related documents, including project information memorandum, and to syndicate debt and equity finance required for financial closure.
To this end, HUDCO would consider co-financing opportunities in participation with KSIDC in proposed debt finance syndicate. At the appropriate juncture, HUDCO could also work with KSIDC in mobilizing resources from domestic and international capital markets.
Besides, KSIDC will also explore the possibility of sourcing low-cost funds from HUDCO for promoting the various industrial parks in the state. The MoU was signed at a time when KSIDC was selected by the Government of Kerala as the nodal agency for conducting the Emerging Kerala-2012 in Kochi during April 19-22. The event will showcase the investment opportunities in various sectors in the state.
The association of HUDCO with KSIDC is intended to provide further fillip in the development of large infrastructure projects, in the context of Emerging Kerala-2012, a press statement said. A steering committee with senior officials from both the organisations for close co-operation and also to explore business opportunities for joint participation has been constituted.
