Canada Pension Plan Investment Board (CPPIB) said Thursday it will invest up to $600 million (Rs 4,300 crore) through the National Investment and Infrastructure Fund (NIIF) Master Fund, deepening its exposure to India.
The agreement includes a commitment of $150 million to the NIIF Master Fund and co-investment rights of up to $450 million in future opportunities to invest alongside the Master Fund.
With CPPIB’s investment, the Master Fund now has $2.1 billion in commitments and has achieved its initially targeted fund size. In addition, the fund's investors have co-investment rights of $3 billion. This will enable the Master Fund to invest a larger corpus to support infrastructure investments in the country.
The Master Fund invests equity capital in core infrastructure sectors in India, with a focus on transportation, energy and urban infrastructure.
CPPIB joins Abu Dhabi Investment Authority, AustralianSuper, Ontario Teachers’ Pension Plan, Temasek, Axis Bank, HDFC Group, ICICI Bank and Kotak Mahindra Life Insurance as investors in the NIIF Master Fund, alongside the Indian government.
CPPIB will also become a shareholder in National Investment and Infrastructure Fund Ltd, the NIIF’s investment management company.
Sujoy Bose, managing director and CEO of NIIF, said: “With this fourth close of the NIIF Master Fund, we are pleased that the fund has achieved its initial target size of $2.1 billion with domestic and international investors of the highest reputation and quality.”
NIIF is a fund manager that invests in infrastructure and related sectors in India. It manages more than $4 billion of capital commitments across three funds, each with its distinct investment strategy. The funds have the mandate to invest in infrastructure assets and related businesses.
Scott Lawrence, managing director and head of infrastructure at CPPIB, said: “The opportunity to invest in, and alongside, NIIF complements our existing direct investment strategy in Indian infrastructure. Through this investment in the NIIF Master Fund, we are also able to deploy capital in additional projects and sectors across the country, providing further long-term opportunities for CPPIB to invest in Infrastructure in India.”
For CPPIB, this will expand its India exposure by almost a tenth. The Canadian pension fund, which has emerged as one of the most aggressive private equity-style investors in India in the last five years, had investments worth $6.5 billion linked to Indian currency as of March 2019.
Since January this year CPPIB has committed over $1 billion fresh investments in India with deals related to SBI Life Insurance Co. Ltd, e-commerce logistics firm Delhivery and green energy firm ReNew Power Ltd, besides the latest commitment. Infrastructure and finance have been the main target areas for the pension fund in the country.
