MUMBAI: Private equity major Actis is ending a high-profile road projects joint venture with the Tata Group, selling its 35% stake to the salt-to-software conglomerate's private equity arm, said a person with direct knowledge of the matter.
The JV between Tata Realty & Infrastructure Ltd (TRIL) and Actis -- struck three years ago -- was expected to invest as much as $2 billion to develop highway projects in Asia's third largest economy. But UK-based Actis, one of the earliest private equity investors in Indian market, is realigning its infrastructure interests with particular focus on energy assets even as road development projects face delays in land acquisition and financial closures.
The JV company's initial equity investment was pegged at $200 million, with TRIL investing $122.5 million and Actis contributing $77.5 million reflecting the 65:35 shareholdings. Actis has invested in the Indian joint venture from its global infrastructure fund and a changed view on domestic road projects emanated from there, added the person cited earlier in this report. Actis couldn't be reached for immediate comments.
Actis, managing assets worth over $5 billion, is selling the TRIL Roads stake to Tata Opportunities Fund. The financial details of the deal, which will close soon, could not be ascertained.
India's roads and highways sector have faced the brunt of an economic slowdown which has hit the infrastructure project financing severely. The tough environment has prompted many infrastructure companies to go slow on bidding for road projects, with some like GMR, IVRCLand GVK planning to sell their interest in road projects. It is estimated that road assets -- completed and in under construction -- worth more than $10 billion are seeking buyers currently.
Tata Opportunities Fund is investing in TRIL Roads after raising $600 million fund recently. The $100 billion group's private equity arm sees the stressed scenario as an attractive investment opportunity and hence is buying out Actis' stake. Last month TRIL Roads said it is buying three road assets in Tamil Nadu from IVRCL. The three projects carry a cost of Rs 2,200 crore.
Sovereign investors like Malaysia's Khazanah Nasional, which has a joint venture with IDFC to invest in national highway projects, and SBI Macquarie Infrastructure Fund, have sought to buy select road assets from troubled developers. Reports have also indicated that L&T Finance is raising a debt fund to explore investment opportunities in the stressed road sector.
Tata Opportunities Fund, headed by Padmanabh Sinha, mainly invests in Tata group of companies, with stakes in Ginger Hotels, Tata Sky, among others. But it's now looking to invest beyond Tata entities and is scanning other investment proposals.
The JV between Tata Realty & Infrastructure Ltd (TRIL) and Actis -- struck three years ago -- was expected to invest as much as $2 billion to develop highway projects in Asia's third largest economy. But UK-based Actis, one of the earliest private equity investors in Indian market, is realigning its infrastructure interests with particular focus on energy assets even as road development projects face delays in land acquisition and financial closures.
The JV company's initial equity investment was pegged at $200 million, with TRIL investing $122.5 million and Actis contributing $77.5 million reflecting the 65:35 shareholdings. Actis has invested in the Indian joint venture from its global infrastructure fund and a changed view on domestic road projects emanated from there, added the person cited earlier in this report. Actis couldn't be reached for immediate comments.
Actis, managing assets worth over $5 billion, is selling the TRIL Roads stake to Tata Opportunities Fund. The financial details of the deal, which will close soon, could not be ascertained.
India's roads and highways sector have faced the brunt of an economic slowdown which has hit the infrastructure project financing severely. The tough environment has prompted many infrastructure companies to go slow on bidding for road projects, with some like GMR, IVRCLand GVK planning to sell their interest in road projects. It is estimated that road assets -- completed and in under construction -- worth more than $10 billion are seeking buyers currently.
Tata Opportunities Fund is investing in TRIL Roads after raising $600 million fund recently. The $100 billion group's private equity arm sees the stressed scenario as an attractive investment opportunity and hence is buying out Actis' stake. Last month TRIL Roads said it is buying three road assets in Tamil Nadu from IVRCL. The three projects carry a cost of Rs 2,200 crore.
Sovereign investors like Malaysia's Khazanah Nasional, which has a joint venture with IDFC to invest in national highway projects, and SBI Macquarie Infrastructure Fund, have sought to buy select road assets from troubled developers. Reports have also indicated that L&T Finance is raising a debt fund to explore investment opportunities in the stressed road sector.
Tata Opportunities Fund, headed by Padmanabh Sinha, mainly invests in Tata group of companies, with stakes in Ginger Hotels, Tata Sky, among others. But it's now looking to invest beyond Tata entities and is scanning other investment proposals.