Edelweiss Infrastructure Yield Plus, an alternative investment fund managed by Edelweiss Alternative Asset Advisors Ltd (EAAA), has acquired two annuity road projects from the Hyderabad-based Navayuga Group.
The two projects are the Assam-based Navayuga Dhola Infra Projects Ltd and the Arunachal Pradesh-based Navayuga Dibang Infra Projects Pvt. Ltd, Edelweiss said in a statement. It did not disclose the deal value.
Edelweiss said the acquisition will help its portfolio company with its objective of becoming one of the country’s leading investors and asset owners in the roads sector.
“Acquiring operating infrastructure assets provide impetus to the revival of the sector by helping construction companies to release capital and de-lever,” Hemant Daga, deputy chief executive officer at Edelweiss Global Investment Advisory, said.
Earlier, reports in June last year had suggested that Edelweiss’ fund would acquire two annuity assets from Navayuga for around $150 million (around Rs 1,014.4 crore then).
Edelweiss’s acquisition of the projects from Navayuga Road Projects Pvt. Ltd – a subsidiary of Navayuga Engineering Company Ltd – has been made along with its portfolio company, Sekura Roads Ltd (SRL).
In road projects operated on the annuity model, a special purpose vehicle constructs the asset and receives fixed payments from the National Highways Authority of India or state government authorities throughout a specified concession period.
SRL is Yield+’s road and highway infrastructure platform, which focusses on acquiring operating road assets. Edelweiss said the acquisition of the two projects from Navayuga will help its portfolio company with its objective of becoming one of the country’s leading investors and asset owners in the roads sector.
Separately, Navayuga Group chief financial officer Sachin Bhansali said the infrastructure and engineering outfit was looking to de-leverage its balance sheet. “This transaction will significantly ease out the debt position of the group and help free up cash,” he said.
Promoted by Chinta Visweswara Rao, Navayuga says it has over 30 years of experience in the infrastructure and engineering sectors.
Edelweiss Infrastructure Yield Plus marked its first close on March 31 in 2018. At the time, the AIF vehicle said it was planning to raise an additional $668 million (Rs 4,500 crore) over the next 12 months, having already secured $297 million, or Rs 2,000 crore.
The fund, which launched near the end of 2017, has a 10-year life and is reportedly targeting an internal rate of return of 18-20% in rupee terms.