By Raji Reddy Kesireddy,
ET Bureau | 10 Mar, 2014, 04.31AM IST
HYDERABAD; The Andhra Pradesh government is looking to sell its equity stake in several marquee urban infrastructure projects in Hyderabad, likely kicking up a row because the state is in the process of being divided to from Telangana.
The stake sale could fetch several hundred crores of rupees but it could also lead to controversy, because Hyderabad is located in Telangana, the new state which may claim ownership of the equity holdings in the public-private partnership (PPA) projects ..
Last month, Parliament approved the creation of Telangana as India’s 29th state. It also said Hyderabad will be the joint capital of Telangana and residual Andhra Pradesh for 10 years.
Last week, the authorities of the undivided Andhra Pradesh began dividing the state government’s equity holdings in dozens of infrastructure projects taken up under public-private partnerships and aim to complete the work by June 2.
A person with knowledge of the divestment process said the state government, though its nodal agency Andhra Pradesh Industrial InfrastructureBSE 2.35 % Corporation, has decided to sell stakes in at least three landmark projects in Hyderabad. The projects in include the Hyderabad International Convention Centre, Hyderabad Information Technology and Engineering Consultancy (Hitec) City and Mind Space IT Infrastructure Project, the source told ET seeking anonymity. APIIC holds stakes ranging from 11% to 26% in these urban infrastructure projects.
Valuers and auditors are being appointed to assess the worth of the equity investments by the state government. Andhra Pradesh has investments in some 300 industrial parks spread over 1.21 lakh acre. It has stakes in 29 joint venture companies with private entities.
APIIC, whose initial focus was selling developed industrial plots to businesses, reoriented itself to the changing needs of the economy and joined hands with private firms. The corporation holds equity stakes in projects mostly in lieu of the land given to infrastructure projects. In some cases, it has made cash investments.