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NCC Infrastructure Holdings Ltd, a subsidiary of NCC Ltd, along with Soma Enterprise Ltd has executed agreements to sell their stake in Bangalore Elevated Tollway Ltd to India infrastructure Fund II managed by IDFC Alternatives Ltd.
The move is part of NCC’s strategic initiative to divest road BOT projects. The share purchase pact was struck with India Infrastructure Fund II. Together, NCC and Soma hold 38 per cent equity shareholding in the BETL project.
The divestment entails full exit from BETL including through sale of preference shares held and repayment of shareholders' loans held by both NCCIHL and Soma in BETL.
The BETL 34-km road project, including a 10-km four-lane elevated highway road connecting Silk Board to Electronic City junction on National Highway 7 in Bengaluru, was executed through the special purpose vehicle. The project has been fully operational since April 2010 and has a 20-year concession period. It was awarded by the National Highway Authority of India Ltd.
The enterprise value of the transaction is Rs 750 crore and is expected to be completed on achieving the conditions agreed upon between the parties, including approvals and other closing conditions and formalities.
For the financial year 2014-15, the turnover and networth contribution of BETL in the consolidated accounts of NCC stood at Rs 28.242 crore and Rs 40.93 crore respectively.
Aditya Agarwal, Partner at IDFC Alternatives, in a statement said, “Buying control in operational cash generating core assets remains our preferred investment thesis. We look forward to continuing the calibrated traction on our roads platform and having BETL as the latest in a series of disciplined acquisitions over the past couple of years.”
NCC close to divesting power plant stake to Sembcorp
NCC is at an advance stage of divestment of its stake in the 1,320 MW power project coming up at Nellore in Andhra Pradesh to Sembcorp Industries of Singapore.
The company is both an EPC contractor and developer of the thermal power plant coming up through a venture with Sembcorp, NCC and Gayatri Projects. Sembcorp has developed another project of 1,320 MW with Gayatri projects.
The company expects the unit one of 660 MW to be commissioned by March 2016 and unit two of 660 MW by June 2016. The company expects to divest its stake and agreements have been inked with Sembcorp. This will be completed within 15-20 days, YD Murthy, Executive Vice-President-Finance, NCC.
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