India Grid Trust (IndiGrid), the country's first investment trust in power sector, has closed the acquisition of two power transmission assets from Sterlite Power for an enterprise value of Rs 5,025 crore.
The two assets are NRSS XXIX Transmission Limited (NTL) and Odisha Generation Phase II Transmission Limited (OGPTL). The definitive documents to acquire them were signed in April.
The acquisition was funded through the preference unit issuance worth Rs 2,514 crore subscribed by KKR, GIC and other capital market investors in May. The remaining amount was funded through debt raise at IndiGrid and OGPTL.
For this purpose, IndiGrid issued Rs 1,400 crore of AAA rated debentures and Rs 200 crore worth AAA rated market linked debentures, the first of its kind issuance by an infrastructure investment trust (InvIT) in India.
A loan of Rs 550 crore at OGPTL was extended by Axis Bank. Post-acquisition, IndiGrid's net debt to assets under management (AUMs) is below 49 per cent and significantly lower than the permissible leverage cap of 70 per cent, leaving significant debt headroom for future acquisitions.
Following the acquisition, IndiGrid's AUMs have increased from Rs 5,220 crore to Rs 10,660 crore. The InvIT currently manages a portfolio of eight power transmission assets with a total network of 18 power transmission lines that span more than 4,900 circuit kilometres across 11 states.
These acquisitions of assets will expand IndiGrid's portfolio and better enable it to deliver stable and growing yield.
IndiGrid CEO Harsh Shah said in a statement: "We will be able to reach Rs 17,000 crore of AUMs and remain well on our way to achieving Rs 30,000 crore of assets under management by 2022, while providing predictable and growing distributions to our investors.
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