Edelweiss buys two North-East road assets from Navayuga

Mumbai | Updated on June 07, 2020

Edelweiss Infrastructure Yield Plus, an alternative investment fund managed by Edelweiss Alternative Asset Advisors (EAAA), along with portfolio company Sekura Roads Ltd (SRL), has acquired two annuity road assets in the North-East.

Navayuga Dhola Infra Projects Ltd in Assam and Navayuga Dibang Infra Projects Pvt Ltd in Arunachal Pradesh have been acquired from Navayuga Road Projects Pvt Ltd, a subsidiary of Navayuga Engineering Company Ltd.

SRL is the road and highway infrastructure platform of Edelweiss YIELD+, which acquires operating road assets. EAAA manages several funds catering to global and domestic investors across sectors such as infrastructure, distressed assets, collateralised credit and real estate.

With the government’s thrust on boosting economic activity in the North-East, the Dhola and Dibang roads are of strategic importance as they ensure all-weather connectivity between the region and the rest of the country, said a press release. The construction of Dhola bridge, India’s longest river bridge, has opened new doors for economic development to both Assam and Arunachal Pradesh, it added.

‘Healthy portfolio’

With an AUM of ₹28,000 crore, EAAA focusses on providing long-term growth capital to corporates. “Acquiring operating infrastructure assets provides an impetus to the revival of the sector by helping construction companies release capital and de-lever, enabling them to commence new projects which contribute to nation building and is becoming the core model to meet India’s infrastructure capital requirement,” said Hemant Daga, Deputy CEO, Edelweiss Global Investment Advisory.

“This is in line with our strategy of investing in infrastructure assets which can deliver predictable long-term yield to our investors. We now have a healthy portfolio of operating transmission and operating annuity road assets,” said Subahoo Chordia, Head of Edelweiss Infrastructure Yield Plus.

Sachin Bhansali, CFO, Navayuga Group, said: “Navayuga Group is looking to de-leverage its balance-sheet and asset monetisation is a critical component. This transaction will significantly ease out the debt position of the group and help free up cash.”

The roads sector has been going through stress as a result of the lockdown. The National Highways Authority of India (NHAI) recently announced twin relief measures for toll concessionaires in the form of an extension in the concession period and a proposal to grant Covid-19 loans. This is an attempt to cushion near-term cash flow mismatches and lessen the impact on long-term returns, according to India Ratings.

Published on June 07, 2020

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