JOIN USCanadian funds buy 50% units in NHAI InvIT
Two international pension funds – Canadian Pension Plan Investment Board and Ontario Teachers’ Pension Plan - will be the anchor investors for recently launched Infrastructure Investment Trust (InvIT) of the National Highways Authority of India (NHAI).
Each will pick up 25 per cent equity. The NHAI will retain minimum of 15 per cent equity. The balance units were placed with a diversified set of domestic institutional investors comprising pension funds, insurance companies, mutual funds, banks and financial institutions, the NHAI said in a release.
"The total enterprise value of the initial portfolio of 5 roads was pegged at Rs.8011.52 crore. NHAI InvIT is funding that through debt of Rs 2,000 crore from State Bank of India, Axis Bank and Bank of Maharashtra. The balance is being funded by issuing units of Rs 6,011.52 crore to international and domestic institutional investors, and NHAI as Sponsor," the release said.
The InvIT, launched on October 29 and closed on November 2, is a private placement instrument for international and domestic institutional investors.
"The InvIT will initially have a portfolio of five operating toll roads with an aggregate length of 390 kilometers, with more roads planned to be added later. These roads are located across the states of Gujarat, Karnataka, Rajasthan and Telangana," the release said.
NHAI has granted new concessions of 30-years for these roads. In view of the long-term nature of the assets, the units of InvIT were placed with international and domestic institutional investors. The units have been issued under the private placement route under SEBI InvIT Regulations, 2014 at the upper valuation band of Rs.101 per unit. The units will be listed on NSE and BSE.
"More NHs will be added to the InvIT portfolio, as the long-term revenue-generating assets such as toll roads provide stable and long-term yields under the InvIT structure," Union Road Transport Minister Nitin Gadkari said tweeted.
As part of the monetisation programme announced by the government, NHAI plans to sell about 32 more operational road assets spanning 1,500 km as well as upcoming ToT (toll operate transfer) projects.
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