An Indian infrastructure investment trust (InvIT) sponsored by Canadian alternative investment firm Brookfield Asset Management Inc. is raising Rs 6,452 crore ($776 million) to refinance its debt.
India Infrastructure Trust is raising the funds by issuing non-convertible debentures and will use the entire proceeds to refinance NCDs of the same amount maturing at the level of Pipeline Infrastructure Ltd. As a result, at a consolidated level, debt will remain unchanged, according to a report by Crisil Ratings.
The InvIT owns Pipeline Infrastructure, a special purpose vehicle which took over the 1,480-kilometre East West Pipeline from a company controlled by Reliance Industries Ltd chairman Mukesh Ambani in 2019. Brookfield acquired the pipeline for Rs 13,000 crore ($1.9 billion), Reliance said at the time.
The East West Pipeline is the sole pipeline connecting Kakinada, Andhra Pradesh, on the gas-producing eastern coast, to Bharuch, Gujarat, on the western coast of India. It also connects key industrial clusters and is connected to state-run GAIL (India) Ltd’s trunk and other pipelines.
Crisil has assigned a ‘AAA' rating to the proposed NCDs with a ‘Stable’ outlook. It said the rating reflects the favorable location of the pipeline, expectation of stable cash flow backed by a 20-year contract with Reliance Industries Ltd and a comfortable financial risk profile.
Brookfield has been operating in India for nearly a decade. The company has $24 billion in assets under management in India across infrastructure, real estate, renewable power and transition, and private equity.
Brookfield in India has a big infrastructure portfolio, primarily across clean energy and telecom towers. It owns a majority stake in Data Infrastructure Trust, an InvIT that was earlier promoted by Reliance Industries, and houses telecom towers that are captive to Reliance Jio Infocomm.