National Investment and Infrastructure Fund Ltd (NIIFL) has announced the acquisition of a 100% equity stake in the Shapoorji Pallonji Group’s SP Jammu Udhampur Highway Ltd through the NIIF Master Fund at an enterprise value of over $290 million. (Approximately ₹2,290 crore).
NIIF is a collaborative investment platform for international and Indian investors, anchored by the Government of India, which manages funds with investments in different asset classes and diversified sectors.
The operational road in the union territory of Jammu and Kashmir (J&K) will be managed by NIIF Master Fund’s proprietary roads platform Athaang Infrastructure.
This acquisition further expands the fund’s road portfolio to four assets with an aggregate revenue rate of more than $170 million per annum, NIIFL said in a statement.
SP Jammu Udhampur developed the highway project under concession from the National Highways Authority of India (NHAI) on a Build-Operate-Transfer (Annuity) basis. The project receives fixed, semi-annual payments from NHAI, providing steady and predictable cash flows.
“We are now among the largest institutional investors in J&K with our two large road acquisitions. The acquisition reinforces our team’s strong underwriting capabilities in successfully closing a complex transaction involving simultaneous equity closure and refinancing of listed Non-Convertible Debentures (NCDs),” said Vinod Giri, managing partner, NIIF Master Fund.
Jai Mavani, Group executive director (Corporate Finance and M&A) says, “The Jammu Udhampur divestment is another milestone in SP Group’s continuing journey of successfully developing, value engineering and monetising strategic projects. This transaction also results in an effective reduction of approximately Rs 1,850 crore of consolidated Group debt besides unlocking of equity.”
The 64.5 km long 4-lane Jammu Udhampur Highway is of strategic national interest in India and enhances connectivity to Shri Mata Vaishno Devi Shrine. Construction of the project involved complex engineering in challenging hilly terrain under extreme weather conditions and was undertaken by Afcons Infrastructure Limited, a part of SP Group.
The highway includes a 1.4 kms twin-tube tunnel stretch.
The Jammu Udhampur Highway was also one of the first projects in the highway sector to raise significant US Dollar External Commercial Borrowings during the construction phase and subsequently re-financing the same through listed Non-convertible Debentures.