Bangalore, 13th Feb, 2013:
In a significant move and in pursuit of the Asset Right and Asset Light Strategy recently announced by the GMR Group, GMR Highways Ltd. signed a definitive agreement with Macquarie SBI Infrastructure Investments Pte Ltd and SBI Macquarie Infrastructure Trust (‘Macquarie SBI’) to divest 74% stake in GMR Jadcherla Expressways Ltd (‘GJEL’), subject to customary closing conditions.
GJEL is operating the Farukhnagar-Jadcherla highway in Andhra Pradesh, under a concession agreement signed with NHAI. The project commenced commercial operations in February 2009. GMR Group will receive consideration of about Rs. 195 Cr immediately and about Rs.11 Cr on completion of certain conditions totaling to Rs. 206 Cr for the sale of 74% stake. The original invested capital for the corresponding 74% stake was about Rs. 146 Cr.
Macquarie SBI, which is one of the largest India focused infrastructure funds has expanded its roads portfolio with this investment and has a well-diversified portfolio with assets in the telecom towers, airports, power, roads and renewable energy sectors.
Kotak Investment Banking was the exclusive financial advisor to GMR Highways Ltd for the transaction.
Mr. Subba Rao Amarthaluru, Group CFO of GMR Group said
“Globally Large Infrastructure Groups follow the strategy of churning the mature Infra Assets to optimize the value realization process and to meet their growth capital requirements. After a phase of rapid growth in diversified infra asset portfolio, we, at the GMR Group, are now consolidating our assets as projects get operationalized. Monetization of assets by picking the right partners to divest is completely in sync with our strategy. This divestment of majority stake in our Jadcherla Road Project is the first step in this direction and reinforces the GMR Group’s Asset Light and Asset Right philosophy. The GMR Group will continue to focus in adopting this approach in other Businesses as well. This partnership will also strengthen the relationship with Macquarie SBI. This is the second investment Macquarie SBI is making in GMR Group after their investment in GMR Airports a few years ago.”
Mr. Suresh Goyal, Chief Executive Officer of SBI Macquarie Infrastructure Management Private Limited, the adviser to MSIF’s manager said:
“This transaction, the seventh that MSIF has completed to date, demonstrates the successful execution of MSIF’s investment strategy in the Indian infrastructure sector, including the roads sector. MSIF invests in a diverse range of assets alongside leading Indian developers who have built high quality assets that provide attractive risk adjusted returns.”
About GMR Infrastructure Limited:
The Company is a Bangalore headquartered global infrastructure major with interests in Airports, Energy, Highways and Urban Infrastructure sectors. It has successfully employed the public-private partnership model to build a portfolio of high quality assets. The Company has 17 power generation assets of which 6 are operational and 11 are under various stages of implementation and 9 Road assets, of which 8 are operational and 1 is under construction. In the Airports sector, it has developed and commissioned the Greenfield International Airport at Hyderabad. The Company, besides operating the existing Delhi International Airport, has also built a brand new integrated terminal T3 which was commissioned in time for the Commonwealth Games in October 2010. It has also upgraded and is operating the Istanbul Sabiha Gökçen International Airport. GMR Group is also committed to social development initiatives and executes these through its Corporate Social Responsibility arm, the GMR Varalakshmi Foundation which is present in 21 locations.
For further information about GMR Group, visit: www.gmrgroup.in
About Macquarie SBI Infrastructure Fund:
The Macquarie SBI Infrastructure Fund (“MSIF”) is an India focused infrastructure fund that is managed by the Macquarie SBI joint venture located in Singapore. The total fund size is approximately $US910 million in total capital commitments representing global financial investors from outside of India.
About SBI Macquarie Infrastructure Trust:
The SBI Macquarie Infrastructure Trust (“SMIT”) is an India focused infrastructure trust that is managed by the SBI Macquarie joint venture located in Mumbai, India. The total fund size is approximately INR 11.9 billion (approximately $US260 million) in total capital commitments representing financial investors from within India.
MSIF and SMIT are separate investment vehicles managed by separate funds management companies, and may choose to co-invest together into projects in India if such projects meet the requirements of the respective funds.
For further information please contact:
Manager – Media Relations
Tel: 080 – 40432373
Email ID: Sowmya.Shenoy@gmrgroup.in
EVP & Group Head – Corporate Communications
Tel: 080 - 40432059
Email ID: Arun.Bhagat@gmrgroup.in