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Maytas Hill County SEZ In Trouble
Posted by Pradeep Sadanapalli | January 27, 2009 | 1,346 views
(4 votes, average: 3.5 out of 5)
Loading ...Maytas Properties, a real estate firm promoted by the family of the disgraced founder of Satyam Computer Services B Ramalinga Raju, may find it tough to complete its prestigious Special Economic Zone project , Maytas Hill County.
Construction at the site has come to a halt as the company has failed to pay outstanding dues so far to the contractor Nagarjuna Construction Company . The firm’s plan to bring Satyam as its anchor client at the SEZ has also run into trouble after the brazen financial fraud at the software firm.
“We have an agreement with Maytas Properties for executing building project worth Rs 184 crore. The building was mainly for housing Satyam as Maytas was planning to showcase the IT company as its anchor client. We have completed works worth Rs 104 crore, of which Maytas is yet to pay back Rs 26 crore to us,” said a NCC official.
According to him, NCC decided to halt work at the site due to the two months delay in payment. “We will carry out the rest of the work depending on payment from Maytas. Looking at the current situation, it will not be feasible for us to continue the work as we are not sure of their liquidity position or ability to raise more funds,” he said.
The 75-acres SEZ along with 300 crore township is the only project from the Maytas stable, which is currently under development. The other real estate project, Jubilee Hills Landmark project, spread over 5.7 acre in the city, is a joint venture between NCC, Maytas and ICICI Venture.
Last year, Maytas Properties had said, it would invest Rs 2,500 crore in 10 years for the SEZ project. The first phase of the project was to be ready by April this year. Maytas Properties, however, declined to comment on the issues relating to payment and the progress of the project. According to a real estate analyst, it would be almost impossible for Maytas Properties to raise money for investing in the project.
“It is even struggling to repay its contractors. The company was banking on Satyam’s entry as its anchor client to attract more companies in the IT/ITeS SEZ. With Satyam facing cash trouble and the entire Raju family mired into a controversy, any other client moving into the SEZ facility is quite unlikely,” he said.
The trouble began after Ramalinga Raju’s botched attempt to acquire Maytas Infra and Maytas Properties for $1.6 billion on December 16.
SOURCES:
Economic Times
Topics: Real Estate Downfall, SEZ, Construction |
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