Singapore-based Cube Highways & Infrastructure Pte. Ltd, which owns and operates toll roads in India, has agreed to acquire two road projects of KNR Constructions Ltd for around Rs 188.5 crore ($26.5 million).
Hyderabad-based KNR Constructions said in a stock exchange disclosure on Monday it will sell its entire stake in KNR Tirumala Infra Pvt. Ltd and KNR Chidambaram Infra Pvt. Ltd to Cube Highways in a phased manner.
The twin transactions barely weeks after KNR Constructions last month agreed to sell KNR Srirangam Infra Pvt. Ltd in a similar deal to Cube Highways for Rs 73.6 crore. The project involves construction of a road in Tamil Nadu. All three projects achieved financial closure in January.
KNR Constructions said it will receive Rs 152.06 crore by selling KNR Tirumala and Rs 36.46 crore from KNR Chidambaram. The final deal value may change at the time of the commercial operation date of the two projects.
The sale is subject to the shareholding transfer restrictions set out in the concession agreement between the National Highway Authority of India and the projects. It is also subject to various regulatory and lender approvals.
The transaction will be completed in two stages. The first stage is scheduled to be completed after achievement of the commercial operation date as per the concession agreement. The second stage is scheduled to be completed after the expiry of a mandatory lock-in period as per the concession agreement.
The KNR Tirumala project involves development, maintenance and management of an existing road on the Chittor-Mallavaram section of National Highway 140 in Andhra Pradesh. The total length of the road to be developed is around 61 km, according to a report by India Ratings and Research.
The KNR Chidambaram project involves development, maintenance and management of Meensurutti to Chidambaram section of NH 227 in Tamil Nadu. This section is part of a highway connecting Coimbatore with Chidambaram. The total length of the road to be developed is around 31 km, according to India Ratings.
Cube Highways is a joint venture between global infrastructure investment firm I Squared Capital and International Finance Corporation, the private-sector investment arm of the World Bank. As on December 2017, it owned more than 1,700 lane-kilometres of highways in India.
In December 2017, Cube Highways agreed to sell a 20% stake to a consortium led by Japan’s Mitsubishi Corp. for an undisclosed amount.
In November 2017, it agreed to sell a minority stake to an entity owned by the Abu Dhabi Investment Authority.