Private enterprise Reliance Infrastructure has apparently declared that it has inked a definitive binding agreement with the company, Cube Highways & Infrastructure III Pte Ltd. As per reliable reports, the agreement entails the sale of Reliance’s 100% stake in DA (Delhi-Agra) Toll Road Pvt. Ltd. to the Singapore-based company that has been formed by I Squared Capital, the global infrastructure fund.
According to sources familiar with the knowledge of the matter, the overall enterprise value of the deal is now more than INR 3,600 crore. Also, NHAI claims worth INR 1,200 crore that is to be filed by DA Toll Road will also be apportioned to Reliance Infrastructure directly.
An official press release by Reliance Infrastructure claims that the transaction is very much in line with the company’s strategic plan of intending to monetize non-core businesses and concentrate on pivotal growth areas such as the engineering & construction (E&C) business. Credible sources affirm that post the official closure of the transaction for the Delhi-Agra Toll Road, Reliance Infrastructure’s debt will apparently be reduced by an approximate 25% – to a worth of something lesser than INR 5,000 crore.
For the uninitiated, Reliance Infrastructure’s SPV DA Toll Road Private Limited is known to operate the showpiece six-lane road, that is around 180 km long, and connects Agra with the capital city of capital Delhi on the NH (National Highway) 2. Reportedly, this remunerative profitable project has witnessed quite an astonishingly impressive revenue growth of 25% in the financial year 2018.
It has been informed that the tolling operations for the seemingly heavily-trafficked project commenced around October 2012 and has a concession period until the year 2038.
The transaction in question is subject to all the necessary permissions and approvals.
Credible sources with the knowledge of the matter affirm that Reliance Infrastructure will be utilizing the proceeds of the deal entirely to reduce its debt.