Private equity firm Apis Partners LLP has agreed to invest up to $110 million (about Rs 770 crore) in L&T Infra Debt Fund Ltd (L&T IDF), a non-banking unit of engineering-to-software giant Larsen & Toubro Ltd that lends to infrastructure projects.
The PE firm, through its Apis Growth Fund II, will pick up a stake of up to 25.1% in L&T IDF, the companies said in a statement.
The statement said that 70% of the total investment amount will be in the form of growth capital for L&T IDF and 30% will be used to buy shares from existing shareholders.
Apis Partners’ investment will effectively be used to refinance operational infrastructure projects in India as it will help L&T IDF, a subsidiary of L&T Finance Holdings Ltd, access low-cost foreign funding.
Matteo Stefanel, co-founder and managing partner at Apis Partners, said the investment comes as India is “projected to be the fastest growing infrastructure market over the next five years.”
Dinanath Dubhashi, managing director and CEO at L&T Finance, said L&T IDF unit has built significant strengths in core areas of renewable energy, road and transmission financing, resulting in a “high-quality loan book and consistent returns”.
For London-based Apis, this is its fourth—and biggest bet yet—on an Indian company.
Its first reported foray was in January 2016, when it invested an undisclosed amount in Mumbai-based Electronic Payment & Services Pvt. Ltd, which offers retail banking technology and ATM services.
In August 2016, Apis, along with ICICI Venture, acquired a minority stake in Star Health and Allied Insurance Co, for $47 million (Rs 315 crore). Exactly two years later, in August 2018, Apis agreed to exit its investment in Star Health, as a consortium of PE firms including WestBridge Capital and Madison Capital and well-known stock market investor Rakesh Jhunjhunwala bought the insurer.
Apis’ third India investment came in December 2017 when it led a consortium of investors that pumped $60 million (Rs 387 crore) into green energy startup Green Planet, which provides off-grid solar products or loans for buying them.
Apis was founded by Matteo Stefanel and Udayan Goyal in April 2014. In March 2017, it made a final close for its Apis Growth Fund-I with commitments of $287 million. The second fund has a target corpus of $400 million with a hard cap of $500 million. Last year, International Finance Corporation, the private-sector investment arm of the World Bank, came in as a limited partner in the second fund.