Infrastructure investment trust India Grid Trust (IndiGrid) on May 4 announced closing of its preference issue of units after raising Rs 2,514 crore (USD 363 million) from eligible investors.
As part of the transaction, global investment firm KKR and GIC have invested Rs 1,084 crore (USD 157 million) and Rs 980 crore (USD 142 million), respectively, the trust said in a release.
KKR has also applied to become a Sponsor of IndiGrid and plans to acquire an additional 15 per cent of IndiGrid’s total units from Sterlite Power, the release said.
Following the closing of transactions, KKR and GIC will collectively own approximately 57 per cent of IndiGrid’s outstanding units.
The preferential issue of units had opened on April 30.
IndiGrid, sponsored by Sterlite Power, in a regulatory filing said that the allotment committee of the board in a meeting on Saturday approved the closure of the issue following receipt of applications from eligible bidders.
The committee also determined and approved the issue price of Rs 83.89 per unit for the units to be allotted to eligible bidders in the preferential issue, the filing said. The unit had closed at Rs 83.99 on BSE Friday.
In a separate transaction, KKR will additionally acquire a majority shareholding in Sterlite Investment Managers Limited, the investment manager owned by Sterlite Power. Sterlite Power established IndiGrid in 2016 and will remain a Sponsor and Project Manager of IndiGrid, the trust said in the statement.
With the capital infusion provided by the new unit issuance, IndiGrid will purchase five electricity transmission assets worth Rs 11,500 crore (USD 1.66 billion) from Sterlite Power. A share purchase agreement for the two operational transmission assets — NRSS XXIX and OGPTL — has been signed, while three additional assets will be purchased once they become operational.
IndiGrid is an infrastructure investment trust established to own inter-state power transmission assets in India. Following the completion of the proposed acquisitions, IndiGrid’s AUM (asset under management) will rise to Rs 17,000 crores (US$2.5 billion).
The trust currently manages a portfolio of six electricity transmission assets with a total network of power transmission lines that span more than 3,361 circuit kilometers across nine Indian states.
The transactions mark KKR’s first investment through its Asia Pacific Infrastructure strategy. KKR makes the investment through a proprietary investment vehicle.
Harsh Shah, CEO of IndiGrid, said that with the new capital investment, they would reach the goal of Rs 17,000 crores of assets under management and were well on their way to achieving Rs 30,000 crore of assets under management by 2022.
David Luboff, Member & Head of Asia Pacific Infrastructure at KKR, said, “Asia Pacific is a core focus for KKR’s global infrastructure strategy, and India is key market for us in the region given its dynamism, the scale of investment opportunities and its crucial need for capital solutions.”
“India holds a tremendous opportunity for infrastructure investment, in the trillions of dollars in the coming decades,” added Sanjay Nayar, Member & CEO of KKR India.