IT services provider Wipro bid and won a contract to undertake the IT systems work for Terminal 3 of the Indira Gandhi International Airport at New Delhi. Terminal 3 is slated to be one of the biggest airport terminals in the world and would be completed by October 2010, in time for the Commonwealth Games.
A company called Wipro Airport IT Services Limited was formed as a joint venture (JV) between Wipro and Delhi International Airport Pvt. Ltd. (DIAL), where Wipro holds 74 per cent stake with the rest being held by DIAL. The JV then entered into a Master Services Agreement (MSA) to provide airport IT infrastructure and services at Terminal 3. The contract is for a period of 10 years and extendable on mutually agreed terms.
The total external finance requirement for the project was Rs. 500 crore and included the cost of hardware, software and implementation. Terminal 3 will cater to all international flights and all non-low cost carrier domestic flights to and from Delhi. Information technology is also a key driver for critical airport operations. Therefore the project holds significant importance for both, DIAL and Wipro.
As a result, IDFC stepped in to provide the external finance needed for implementing this prestigious project.
IDFC's ‘one firm’ solution:
The deal was a challenging one, but the seamless working between three IDFC verticals - IDFC Capital, IDFC Project Finance and IDFC Legal - saw the transaction being dealt with smoothly. IDFC was the sole lender of the project. It originated from IDFC Capital, which stepped in to leverage its strong relationship with the Wipro Group.
IDFC Capital, with inputs from IDFC Project Finance and IDFC Legal then put together a unique financing structure that met with the expectations of Wipro. Thus, all the three verticals leveraged on their expertise to successfully conclude the deal for the Terminal 3 project, which is currently under implementation, and also won a cross sale award for IDFC Capital's debt team.
How it worked at IDFC
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