Neo Infrastructure Income Opportunities Fund (NIIOF), an alternative investment fund (AIF), has inked agreements to acquire two operational road assets under the NHAI’s hybrid annuity model from CDS Infra Projects for Rs 1,500 crore.
Both the road assets are located in Haryana and Punjab and are part of the 669-km four-lane greenfield Delhi-Amritsar-Katra Expressway that is being built to connect Delhi to Katra in Jammu & Kashmir, with a section leading to Amritsar.
NIIOF is Neo Asset Management’s flagship core infrastructure fund that buys out de-risked, operational core infrastructure assets which provide steady and predictable cash flows. Neo Asset Management (NAM), which currently manages multiple funds with a corpus exceeding Rs 10,000 crore.
Hemant Daga, CEO, NAM, said: “Successful signing of SPAs for these assets highlights our ability to source high quality assets as well as foster our deep industry relationships and experience.”
“Situated on one of India’s most significant expressways and built to the highest standards, they fit perfectly with our fund’s strategy of acquiring high-quality, long-term core infrastructure assets,” Abishek Goel, MD and head – infra & real assets and Saurabh Singhal, MD and partner at NIIOF, said in a joint statement.
Hybrid annuity model (HAM) roads have 15-year concessions with the National Highways Authority of India (NHAI) with contracted revenues independent of traffic volumes and hence are considered low-risk investments.
CDS Infra Projects, the seller and developer of the HAM assets, is monetising completed assets to reinvest in future developments, ensuring continued growth and innovation in the sector. Till date, CDS has executed over 30 projects comprising 3,000 lane km of highways/expressways across eight states in the country and is currently executing five more HAM assets to be developed by the next year.