Ashoka concessions restarts talks to sell BOT toll road assets

Ashoka Concessions, a subsidiary of highway builder Ashoka Buildcon, has restarted negotiations to sell its build-operate-transfer (BOT) toll road assets after PE major KKR terminated the proposed transaction in May.

Global funds such as Canada's CDPQ, Macquarie, Cube Highways, and India's NIIF are in early stages of talks to acquire the assets, multiple people aware of the development said. CDPQ is in talks through its infrastructure trust - Indian Highway Concessions Trust.

In 2021, Ashoka Concessions (ACL) and Galaxy Investments II, an affiliate of Kohlberg Kravis Roberts & Co. L.P. (KKR), had signed an agreement for the sale of five BOT toll subsidiaries - Ashoka Highways (Bhandara), Ashoka Highways (Durg), Ashoka Belgaum Dharwad Tollway, Ashoka Sambalpur Baragarh Tollway, and Ashoka Dhankuni Kharagpur Tollway - for ₹1,337 crore. However, the agreement was terminated in May 2023.


From the total proceeds expected from the sale to KKR, the company was to utilise ₹1,200 crore to facilitate the exit of SBI Macquarie from ACL. Ashoka Buildcon holds 66% stake in the firm while SBI Macquarie holds the rest. Macquarie had invested ₹800 crore in Ashoka Concessions in 2012 through Macquarie-SBI Infrastructure Fund (MSIF).

NIIF has signed agreements to acquire Ashoka's stake in two road projects - Jaora Nayagaon Toll Road Company in Madhya Pradesh and Chennai Outer Ring Road.

The company is expecting closure of these two transactions by December and October, respectively, the management told analysts in an earnings call in August.

The management also noted then that this time around they expect a "substantially good" price over and above the offered price in the last process for the sale of the five BOT assets as the traffic revenue of the roads has been far better than estimated in the previous sale model.