India Grid Trust (IndiGrid) has completed acquisition of a transmission asset Gurgaon Palwal Transmission Ltd (“GPTL”), from Sterlite Power at an enterprise value of around Rs.1,080 crore.
With this acquisition, IndiGrid’s AUM (assets under management) has increased by around 9 per cent to Rs.13,300 crore. IndiGrid’s asset portfolio will now consist of 10 power transmission projects, with a total network of 25 power transmission lines and 7 substations extending over 6,080 ckm and 10,735 MVA, respectively, in 15 Indian states.
GPTL is part of Inter State Transmission Scheme (ISTS) network and consists of three gas-insulated substations (GIS) with a total transformation capacity of 3,000 MVA and around 270 ckm of 400kV transmission lines spread across Uttar Pradesh, Haryana and Rajasthan.
Commenting on the acquisition, Harsh Shah, Chief Executive Officer of IndiGrid, said “This acquisition is in line with our strategy to acquire accretive assets with low operating risk and long-term certainty of cash flows. We continue our efforts to increase unitholders’ returns by creating a solid growth pipeline for the future while providing predictable distribution.”
“IndiGrid has a pipeline of transmission projects (valued at around Rs.5,500 crore) under the framework agreement with Sterlite Power providing visibility of Rs.18,000 crore of AUM over next two years. This acquisition is a testament to our consistent track record of aggregating good quality projects with the vision of enhancing investor returns while maintaining a strong balance sheet,” added Shah.
The acquisition of GPTL was envisaged as part of the framework agreement signed with Sterlite Power in April 2019 for acquisition of three assets upon commissioning. This acquisition has been funded by internal accruals, proceeds from the preference issue done in May 2019 and new debt. With this investment, IndiGrid’s net debt/AUM will be at 53 per cent, significantly below the 70 per cent leverage threshold as per SEBI InvIT Regulations.
