IndInfravit Trust snaps up 5 road assets from Brookfield for $1.2 billion

(Representative image: Reuters)

Canadian private equity major Brookfield and its associates on Friday signed definitive agreements with IndInfravit Trust to fully sell five of its operational road projects for a consideration of USD 1.2 billion (about Rs 9,370 crore). The sellers from Brookfield side are BIF India Holdings and Kinetic Holdings, which are companies owned by funds managed by Brookfield Asset Management Inc.

The transaction values these road assets at an enterprise value of around USD 1.2 billion, a statement from IndInfravit Trust and Brookfield India said. The roads portfolio comprises three toll roads and two annuity roads, with around 2,400-lane-kms in Andhra Pradesh, Bihar, Maharashtra and Uttar Pradesh. These assets have been operational, on average, for around nine years, and have an average residual concession period of 20 years.

IndInfravit currently holds a portfolio of 13 operational road concessions with around 5,000-lane kms spread across five states. These acquisitions will expand its portfolio by three more states — Andhra Pradesh, Bihar and Uttar Pradesh. IndInfravit's unitholders include Allianz Insurance companies represented by Allianz Capital Partners, Canada Pension Plan Investment Board (CPP Investments) and OMERS Infrastructure.

This transaction is one of the largest acquisitions in the highways sector in recent times in the country. All the five operating assets are part of the national highways programme and are in states that are economically very active, contributing collectively to around 30 per cent of the national GDP.

Stepping into its fifth year of operations, the Invit presents itself as an established and reliable platform for developers and sponsors to divest their assets, thus creating value and generating significant economic benefit for both parties, said Pawan Kant, chief executive at LTIDPL IndvIT Services, which is the investment manager to IndInfravit Trust.

"We remain a committed supporter of IndInfravit, a portfolio that encompasses significant and critical roads assets," said Scott Lawrence, managing director and head of infrastructure at CPP Investments.

Increasing our interests in infrastructure is part of our ongoing commitment to deliver solid long-term risk-adjusted returns to our contributors and beneficiaries, said Delphine Voeltzel, managing director for Asia at OMERS Infrastructure. The investment in IndInfravit gives us an opportunity to be part of the highly crucial infrastructure sector in India, said Andrew Cox, co-head for infrastructure at Allianz Capital Partners.

Ambit Capital acted as the exclusive financial adviser to IndInfravit, while Cyril Amarchand Mangaldas was the legal adviser.