Grapevine: CDPQ to buy roads from GIP; KKR, others may bid for Emami cement unit
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Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) has agreed to buy road platform Highway Concessions One Pvt. Ltd for Rs 2,400 crore ($335.5 million at current exchange rate), three people with direct knowledge of the development told The Economic Times.

“The ask (valuation expectation) was around Rs 3,000 crore,” said a person involved in the process.

News of the development comes after The Economic Times had said in January that Global Infrastructure Partners (GIP) is in talks with suitors to sell the road platform. Citing two people with direct knowledge of the plan, the report had said the suitors were Canada Pension Plan Investment Board (CPPIB), CDPQ and National Investment and Infrastructure Fund (NIIF).

US-based GIP had last year bought the entire infrastructure portfolio of homegrown private equity firm IDFC Alternatives, it put the road platform on the block late last year. Highway Concessions holds seven road projects covering 472 kilometres and having consolidated revenues of Rs 620 crore a year.

The five toll roads and two annuity projects are: Ulundurpet Expressways in Tamil Nadu, Nirmal BOT in Telangana, Dewas Bhopal Corridor in Madhya Pradesh, Bangalore Elevated Tollway in Karnataka, Godhra Expressways in Gujarat, Jodhpur Pali Expressway in Rajasthan and Shillong Expressway in Meghalaya.

Separately, the cement unit of cosmetics-to-paper conglomerate Emami Group may get bids from Blackstone and a consortium of KKR & Co. and detergent maker Nirma Ltd, people in the know told Bloomberg, adding that TPG Capital may also bid with a local partner.

Emami Group, which joins tycoons including Anil Ambani and Subhash Chandra in selling assets to pare debt, is seeking a valuation of about $1 billion. The Kolkata-based conglomerate is led by R S Agarwal and R S Goenka.

Emami Cement runs three manufacturing plants in India and is setting up another in Kalinganagar, Odisha, according to its website. 

Meanwhile, private equity major Baring Partners and a strategic investor are in the race to buy 30% stake in Can Fin Homes Ltd, the housing-finance subsidiary of state-run lender Canara Bank.

“The prime driver for this deal is Canara Bank seeking to get Rs 1,000 crore ($139 million at current exchange rate) out of the transaction. The cost of funds has shot up from last year,” a person close to the development told The Economic Times.

For Can Fin Homes, loans to self-employed individuals increased to 29% in 2018-19 from 15% in 2014-15, the report pointed out.

Caladium Investment, an affiliate of Singapore’s sovereign wealth fund GIC (formerly known as Government of Singapore Investment Corporation), acquired a 13.45% stake in Can Fin Homes from Canara Bank in 2017 for Rs 754 crore.

In another development, Adani Group and Anil Ambani’s Reliance Group are competing with a consortium of IRB Infrastructure and GIC for toll operation rights on Mumbai-Pune Expressway, The Economic Times said.

Cube Highways and Infrastructure, a road platform backed by I Squared Capital, Macquarie, and National Investment and Infrastructure Fund are also in the fray, people in the know said, adding that the winning bid is expected to be picked within a month.

The Maharashtra State Road Development Corp. and National Highways Authority of India (NHAI) are expecting to receive Rs 8,000 crore (about $1 billion at current exchange rate) from the sale of rights, the persons added.

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