Infrastructure investment trust, India Grid Trust (IndiGrid), on Tuesday said it has received board approval to fully acquire power transmission firm, Raichur Sholapur Transmission Pvt. Ltd for up to Rs 250 crore in one or more tranches.
IndiGrid will purchase 100% in Raichur Sholapur Transmission's from its existing investors - Patel Engineering (33.4%), Simplex Infrastructures (33.33%) and BS Ltd (33.33%), said the KKR-backed InvIT in a statement.
"As a low-risk operational transmission asset with long-term contracted cash flows and minimal counterparty risk, this acquisition fits in well with IndiGrid’s growth strategy," said Jyoti Kumar Agarwal, chief executive officer at IndiGrid.
Raichur Sholapur Transmission, incorporated in 2009, operates one single circuit 765 kilovolt (kV) transmission line between Raichur in Karnataka and Sholapur in Maharashtra. In the last fiscal year, the company posted revenue of Rs 38.7 crore.
Agarwal explained that the acquisition would be distribution point unit (DPU) accretive and will provide further visibility to sustain the increased DPU of Rs 3.30 per unit for a longer period of time.
"We are committed to grow IndiGrid by acquiring value accretive projects while ensuring predictable distributions and superior investor returns," added Agarwal.
In December 2020, IndiGrid agreed to fully acquire two solar assets operated by FRV Solar Holdings located in Andhra Pradesh. In the previous month that year, it said it would acquire a 74% stake in Parbati Koldam Transmission Co Ltd from Anil Ambani group’s Reliance Infrastructure Ltd.
IndiGrid owns 14 operating power projects, consisting of 40 transmission lines with over 7,570 circuit km length, 11 substations with 13,550 MVA (mega volt ampere) transformation capacity and 100 megawatts (MW) alternating current (AC) of solar generation capacity.
KKR invested Rs 1,084 crore in IndiGrid in May 2019 and currently owns 24% stake in the platform, according to its latest annual report. Separately, KKR also holds a 100% stake in IndiGrid Investment Managers Ltd, the investment manager of IndiGrid.
