IndInfravit Trust (IndInfravit) and Sadbhav Infrastructure Project Limited (SIPL) executed definitive agreements whereby IndInfravit has agreed to purchase the entire equity shareholding of SIPL in nine of SIPL’s operational road projects from SIPL.

The transaction values 100% of the Roads Portfolio at an enterprise value of approximately INR 66,100 million (US$ 965.67 million). Upon completion of the transaction, pursuant to the definitive agreements, SIPL will receive the consideration from IndInfravit in cash as well as allotment of units of IndInfravit; post-completion, SIPL will hold not exceeding 10% unitholding in IndInfravit.

The transaction is subject to certain regulatory and other customary conditions precedent common in transactions of this nature, including the approval of the relevant regulatory authorities and lenders as well as unitholders of IndInfravit and shareholders of SIPL.

The Roads Portfolio comprises seven toll roads and two annuity roads, with total 2,619 lane km in Gujarat, Karnataka, Maharashtra, Rajasthan and Telangana, some of India’s most economically vibrant states. The roads forming part of the Roads Portfolio have been operational, on an average, for approximately six years, and are used by diverse groups of road users and commercial traffic. The states in which these roads are present contribute c.39% to the GDP and c.28% to the population of India.

IndInfravit, sponsored by L&T Infrastructure Development Projects Limited (L&T IDPL), currently holds a portfolio of five operational toll road concessions. In addition to L&T IDPL, the other unitholders include Allianz insurance companies represented by Allianz Capital Partners, Canada Pension Plan Investment Board (CPP) and OMERS Infrastructure.

SIPL is a leading Indian road developer, majority of which is owned by Sadbhav Engineering Limited (SEL). Both SIPL and SEL are entities listed on the stock exchanges in India. Post the completion of this transaction, SIPL will continue to own three operational road project companies and 12 under-construction road projects under the Hybrid Annuity Model. SIPL will continue to focus on its core expertise of development of new roads and utilise the sale proceeds from this transaction to recycle capital in to bidding for new road projects, inject equity in current under-construction projects and prepay debt.

Ambit Private Limited acted as the exclusive financial adviser to IndInfravit. Morgan Stanley acted as the exclusive financial adviser to SIPL.