GMR Infrastructure looks to sell stake in four road assets to raise Rs 1,800 crore

 

MUMBAI: GMR Infrastructure is in talks with potential investors such as Morgan Stanley Infrastructure Fund, Citigroup Venture Capital, SBI Macquarie and ICICI Venture to divest stake in four toll road assets and raise about Rs 1,800 crore to cut debt. The infrastructure company, which builds airports, power projects and roads, has received expressions of interest (EoIs) from these prospective investors, said three senior industry official close to the transaction.

"The funds are expected to start due diligence of the road assets shortly and complete the stake purchase in six months. The assets are not offered as one block," said one of the officials. Arun Bhagat, a Bangalore-based spokesperson for GMR, said: "As a company policy, we are unable to comment on price-sensitive information and speculative news." Spokespersons of Morgan Stanley Infra Fund, Citigroup Venture Capital, SBI Macquarie and ICICI Venture did not respond to e-mail queries from ET. GMR kicked off the divestment process in its highway business in April this year by approaching select investors with a proposal seeking to sell 67-76% stake in four different assets close on the heels of its divestment of majority stake in Jadcherla Expressways to SBI Macquarie in February 2013.

Pochenpalli Expressways, Ulundurpet Expressways, Hyderabad-Vijaywada and Hungund Hospet are the assets which are offered for sale. GMR had invested about 900 crore in the four assets. It has nine road assets, out of which eight are operational. The Bangalore-based Group has recently sold 70% stake in Jadcherla Expressways for Rs 206 crore, translating into a 40% increase in its investment. Considering this as a benchmark, the company would raise Rs 1,260 crore by selling stakes in four toll road assets. 

                                                      Amjad Khan

                                                      PGDM 2nd Sem