Business conglomerate Shapoorji Pallonji Group (SP Group) has divested its entire stake in SP Jammu Udhampur Highway to National Investment and Infrastructure Fund (NIIF) for $290 million (about Rs 2,280 crore). The deal also helps the group to reduce its consolidated debt by about Rs 1,850 crore.
SP Jammu Udhampur Highway is the developer of Jammu Udhampur Highway project, which is under concession from the National Highways Authority of India on a build-operate-transfer basis.
“This is in line with SP Infrastructure’s strategy of creating long-term value by developing strategic infrastructure projects. It also demonstrates the group’s versatile capabilities across the entire project life cycle involving the development, financing, operations and unlocking of value,” Sanjay Date, chief executive of the transportation business at SP Infrastructure, said.
Anchored by the Indian government, NIIF is a collaborative investment platform for global and Indian investors and manages funds with investments in different asset classes and diversified sectors.
The 64.5-km-long four-lane Jammu Udhampur Highway is of strategic national interest and enhances connectivity to the Shri Mata Vaishno Devi Shrine. Construction involved complex engineering in challenging hilly terrain under extreme weather conditions and was undertaken by Afcons Infrastructure, an SP Group company.
The project had raised external commercial borrowings in dollar terms during the construction phase and is re-financing them through listed non-convertible debentures.
“The Jammu Udhampur divestment is another milestone in SP Group’s continuing journey of successfully developing, value engineering and monetising strategic projects. This transaction also results in an effective reduction of about Rs 1,850 crore of consolidated group debt besides unlocking equity” Jai Mavani, group executive director (corporate finance and M&A) at SP Group, said.
The transaction was supported by AZB & Partners as legal counsel, SBI Capital Markets as transaction advisors, Katalyst Advisors as structuring and tax advisory and Trustwell for investor outreach.