BRNL inks deal to sell Odisha road project, valued at around Rs 2000 cr

The deal is for Shree Jagannath Expressway Private Limited, the special purpose vehicle (SPV) engaged in the development of a 67-kilometre toll road project from Bhubaneswar to Chandikhole, in Odisha

Bharat Road Network Limited (BRNL) has signed an agreement with India Highway Concession Trust, an infrastructure investment trust set up by Caisse de dépôt et placement du Québec (CDPQ), a global investor, for the sale of a BOT (build-operate-transfer) road project in the state of Odisha.

BRNL is the largest shareholder, with a 40 per cent stake in the project. The share purchase agreement provides for the complete transfer of ownership of Shree Jagannath Expressway Private Limited, the special purpose vehicle (SPV) for developing a 67-kilometre toll road project from Bhubaneswar to Chandikhole, in Odisha. Project operations started in December 2011, with an initial concession period of 26 years.

Sources said that the enterprise value of Shree Jagannath Expressway is estimated to be in the range of Rs 1,800-2,000 crore.

Commenting on the development, Bajrang Kumar Choudhary, managing director, BRNL said, “The transaction is in line with BRNL’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.

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