Mumbai Metro-1: MMRDA Set To Fully Own Metro One Private Ltd With Rs 4,000 Crore Buyout, Allowing Anil Ambani's R-Infra To Exit

The Maharashtra state cabinet has given green light to the Mumbai Metropolitan Region Development Authority (MMRDA) to purchase Reliance Infra’s 74 per cent stake in Mumbai's Metro-1 corridor.

An internal study group led by former chief secretary Johny Joseph had valued the stake at Rs 4,000 crore, and the cabinet finalised the decision, as per a report by The Economic Times.

This acquisition allows Anil Ambani's Reliance Infra (R-Infra) to exit the project after requesting the government to buy its stake due to pandemic-related losses.

The buyout, which began in 2020, was delayed as the government and the company could not agree on the valuation.

State urban development secretary Aseem Kumar Gupta stated, "Metro-1 is crucial for public transport, and we aim to prevent any disruption in service."

Metro-1, the only PPP-executed corridor, operates under the special purpose vehicle (SPV) Mumbai Metro One Private Ltd (MMOPL). Post-acquisition, MMRDA will own MMOPL entirely, holding a 26 per cent stake in the SPV, while R-Infra holds 74 per cent.

The concession agreement was signed in 2007, and the corridor began operations in 2014.

However, MMOPL faced challenges in fare revision, leading to losses, with the second fare fixation committee rejecting fare hike proposals in 2019 and suggesting non-fare revenue generation.

MMOPL is also engaged in arbitration with MMRDA over construction cost escalations, with MMOPL claiming Rs 4,026 crore and MMRDA asserting Rs 2,356 crore as per the original contract.

Despite pandemic-induced closures, Metro-1's ridership has remained high, carrying 4.5 lakh commuters on weekdays. It is a vital corridor offering faster travel options, particularly along the congested Andheri-Kurla Road.