Canada Pension Plan Investment Board (CPPIB) today announced the acquisition of an additional 15.9% stake in IndInfravit Trust through two transactions, bringing its total holding in the infrastructure investment trust or InvIT to 43.8%.
The combined investment amount from the two transactions is Rs 1,005 crore or C$173 million ($136.2 million).
In one deal, CPPIB has acquired 7% stake from Sadbhav Infrastructure Project and through the other it will acquire 8.9% from L&T Infrastructure Development Projects Ltd (L&T IDPL), the Canadian pension fund said.
The acquisition from L&T IDPL is expected to be completed before mid-May, subject to regulatory requirements, the firms said.
IndInfravit, sponsored by L&T IDPL and launched in 2018, acquires and maintains stable road concessions in India.
In 2014, CPPIB invested Rs 1,000 crore ($157 million then) in L&T IDPL, a subsidiary of engineering and construction conglomerate Larsen & Toubro. Next year, it put in an additional Rs 1,000 crore. Then in 2018, when L&T IDPL floated IndInfravit, CPPIB bought 30% stake in the trust.
IndInfravit holds a portfolio of 13 operational road concessions across five states: Karnataka, Maharashtra, Rajasthan, Tamil Nadu and Telangana. The roads, located along key national transport corridors, primarily serve inter-city and long-distance freight traffic and have been operational, on average, for about seven years.
“We have been invested in IndInfravit, the first private InvIT of its kind in India since its inception in 2018,” said Scott Lawrence, managing director and head of infrastructure, CPPIB.
L&T IDPL will continue to act as a sponsor of the trust and its subsidiary will remain the investment manager for IndInfravit. L&T IDPL and Sadbhav Infrastructure Project will continue as project managers for the portfolio.