The National Investment and Infrastructure Fund Ltd (NIIF), a Centre-anchored platform, will acquire two toll road projects from debt-laden Essel Group.
The acquisition of the Essel Devanahalli Tollway and Essel Dichpally Tollway will be made through the NIIF Master Fund, and will be managed by Athaang Infrastructure, NIIF’s proprietary roads platform.
Essel Devanahalli is an arterial 22 kilometre six-lane toll road in Karnataka that connects Bengaluru and its airport. It is part of National Highway (NH) 44 and has an operational history of six years.
Essel Dichpally is a 60 km four-lane toll road in Telangana that connects Hyderabad and Nagpur and serves long-distance commercial traffic. It has been operational for over seven years.
The acquisition of the two projects will help NIIF build its portfolio in the roads and highways sector, it said. It did not disclose the financial details of the transaction.
“Athaang will invest in strategic assets and develop a portfolio including mature operational assets, annuities/hybrid annuities, large expressways and highways with greenfield and brownfield expansion requirements,” NIIF managing partner Vinod Giri said.
He added that the platform’s objective is to “emerge as the preferred stakeholders in the Indian roads sector”.
Apart from this sector, NIIF says its Master Fund has also anchored platforms in spaces such as ports and logistics, renewables, and energy smart meters.
The central government set up the NIIF in 2016 as part of its efforts to accelerate private and foreign investment into the country’s infrastructure.
Investors in the platform include domestic banks such as ICICI Bank, HDFC Bank and Axis Bank. Domestic insurance companies and foreign wealth and pension funds including Abu Dhabi Investment Authority and Canada’s Ontario Teachers’ Pension Plan are also investors.
In December last year, the Canada Pension Plan Investment Board (CPPIB) said it would invest up to $600 million (Rs 4,300 crore) through the Master Fund.
In April that year, NIIF set up a $2 billion platform to invest in road projects in India along with infrastructure investment firm ROADIS, which is a wholly owned subsidiary of the Public Sector Pension Investment Board (PSP Investments) of Canada.