Actis plans roads InvIT, could raise up to ₹2,000 crore

UK-based global private equity firm Actis is looking to monetise a portfolio of operating road assets that it owns in India through an infrastructure investment trust (InvIT), potentially raising as much as ₹1,500-₹2,000 crore, said two sources aware of the development. Last year, Actis acquired a portfolio of six roads - five hybrid annuity model (HAM) properties and one build operate and transfer (BOT) road - from Welspun Enterprises for an enterprise value of ₹6,000 crore ($775 million).

This was the first set of roads that Actis bought in India after expanding into the roads sector, following its success in the renewable industry where it has sold two large platforms - Sprng Energy and Ostro Energy.

The six roads were acquired by Actis' Long Life Infrastructure Fund, which seeks to invest in stabilised operating assets within multiple infrastructure sectors and deliver a strong cash yield for investors. Actis has filed for the registration of the trust with the markets regulator Securities and Exchange Board of India (Sebi), said the sources cited above.

"They are waiting for approval of the trust from Sebi. Simultaneously, work is progressing on the draft prospectus of the InvIT, and they are likely to file the draft papers in a month's time. Axis Capital is advising Actis on the InvIT fundraising," said one of the sources cited above.

The proposed fundraising of around ₹1,500-2,000 crore will mostly be used to repay or prepay part of debt of the road assets, said the second source.

"It is likely that at this point that the entire portfolio may not be added to the InvIT and these may be added at a later point. Other new roads that will be acquired in future by Actis will also be dropped into the InvIT," the source said.

The portfolio of roads includes five completed HAM assets Delhi-Meerut Expressway (Pkg 1), Chutmalpur-Ganeshpur, Gagalheri-Saharanpur-Yamunanagar, Chikhali-Tarsod, Maharashtra Amravati (Pkg 2) and one operating BOT toll asset - Mukarba Chowk-Panipat.

ET reported on May 5 that Actis was in talks to acquire a portfolio of four roads from Patel Infrastructure.