Bharat Road Network inks deal for sale of road project in Odisha

Bharat Road Network on Thursday said it has signed an agreement with India Highway Concession Trust, an infrastructure investment trust set up by Canadian institutional investor Caisse de dépôt et placement du Québec (CDPQ), for the sale of a road project in Odisha.

The company has executed a securities purchase agreement with Indian Highway Concessions Trust acting through its investment manager, for sale of the entirety of the company's shareholding in Shree Jagannath Expressways Pvt Ltd, Bharat Road Network Ltd (BRNL) said in a regulatory filing.

Bharat Road Network said the equity value of the proposed transaction is subject to adjustments of debt and other capital and operational costs at closing date and hence net consideration receivable is not ascertainable at this stage.

BRNL is currently the largest shareholder, with 40 per cent stake in this project.

The share purchase agreement provides for the complete transfer of ownership of Shree Jagannath Expressway Pvt Ltd, the special purpose vehicle (SPV) engaged in the development, operation and maintenance of a 67-kilometre toll road project from Bhubaneswar to Chandikhole, in Odisha, the company said.

Bajrang Kumar Choudhary, Managing Director, BRNL, said the transaction is in line with the company's strategic plan for stakeholder value creation through portfolio assets reallocation while focusing on enhancing operational excellence and increasing financial efficiencies in existing assets.

"The transaction is expected to help BRNL in reducing its debts and will also provide the company with funds for reinvesting in its existing assets under construction," he added.

Emmanuel Jaclot, Executive Vice-President and Head of Infrastructure, CDPQ, said: "It will be the first asset integrated into the new CDPQ-owned roads platform in India, which we set up and staffed in 2020. This reflects our long-term confidence and interest for the sector and more broadly the Indian infrastructure market.”

The transaction is subject to regulatory approvals and other closing conditions.