IRB Infrastructure gets first tranche of investment of Rs 3,753 cr from GIC affiliates

IRB Infrastructure Developers on Tuesday said it has received the first tranche of investment of Rs 3,753 crore from GIC affiliates.

In a regulatory filing, IRB Infrastructure Developers said Rs 3,753 crore from GIC affiliates has been received out of its commitment of Rs 4,400 crores by IRB Infrastructure Trust.

"The balance commitment will be invested on the progress of construction of the under-construction projects," the filing added.

In August 2019, the company had announced signing of definitive agreements with GIC affiliates, for an investment up to Rs 4,400 crore -- amounting to 49 per cent stake in a portfolio of nine of its assets through Private InvIT structure (IRB Infrastructure Trust), while IRB was to retain controlling stake of 51 per cent in the Trust.

The portfolio spans across 5,900 lane kms in Haryana, Uttar Pradesh, Rajasthan and Gujarat, Maharashtra and Karnataka.

"All nine assets in the portfolio are revenue generating assets," the filing said.

The net revenue of the portfolio in FY2019 was around Rs 630 crore. Upon completion of construction of the nine BOT (build-operate-transfer) assets, the enterprise value of the private InvIT will be about Rs 22,500 crore.

"With this investment for the largest transaction in the roads and highways sector, a meaningful long-term relationship has been forged with GIC, one of the world's leading sovereign wealth funds," said Virendra Mhaiskar, Chairman and Managing Director, IRB.

The allotment of units to the investors will happen by February 27, 2020. Post the allotment of units, IRB will hold 51 per cent and GIC affiliates will hold 49 per cent stake in the Private InvIT.

"This platform will not only give us exposure to a large, well-positioned and diversified portfolio of toll roads in India, but also enable IRB to continue growing their business. India remains a key long-term market for GIC given its strong economic fundamentals and infrastructure development potential," said Ang Eng Seng, Chief Investment Officer of Infrastructure at GIC.

Bajaj Consultants Private Limited acted as the exclusive financial advisor to IRB for the transaction.

S&R Associates acted as the legal advisor to IRB and Nishith Desai Associates acted as the legal advisor to GIC affiliates, the filing added.

Shares of IRB Infrastructure Developers were trading at Rs 96.45 a piece on BSE, up 3.32 per cent.