In order to encourage cash burdened companies, market regulator SEBI has introduced infrastructure investment trust (InvIT) to unlock capital and generate revenue.
Mumbai based toll collection and road maintenance company, MEP Infra is planning to become one of the first infra companies to raise money through the InvIT route.
According to sources, MEP is eyeing raising Rs 1000 crore from InvITs to cut on debt and use the revenue to bid for toll-operate-transfer (TOT) and operate-maintain-transfer (OMT) projects.
The company plans to transfer the Mumbai entry point projects held via special purpose vehicles (SPVs) to the investment trust where MEP will have majority stake in the InvIT and the trust will hold the SPVs.
At present the company has 23 operate-maintain-transfer (OMT) projects with Mumbai entry point being the largest of them all, having five road projects.
MEP has a consolidated debt of nearly Rs 3000 crore and has been seeking investments from foreign investors and domestic institutions.
Sources say the company plans to file the trust with SEBI in January, 2016.
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