PNC Infratech offloads 12 road assets to Highways Infrastructure Trust for Rs 9,000 crore; stock hits new 52-week high

16 Jan 2024 , 01:07 AM

PNC Infratech announced on 15 January that it has signed definitive agreements with KKR-backed Highways Infrastructure Trust (HIT) to sell 12 of its road assets, including 11 National Highway (NH) Hybrid Annuity mode (HAM) assets and 1 State Highway BOT Toll asset, for an enterprise value of Rs 9,005.7 crore. This is one of the largest highway acquisitions by a KKR-backed business.

HIT is an Infrastructure Investment Trust (InvIT) connected with funds managed by KKR & Co. Inc, according to a news release from PNC Infratech. The deliberate initiative to divest road assets spans around 3,800 lane km across Uttar Pradesh, Madhya Pradesh, Karnataka, and Rajasthan.

Ten of the 12 projects are now functioning, with the remaining two projects under development and will be bought when they begin operations.

The enterprise value of the big transaction includes earn-outs, resulting in an equity value of Rs 2,902 crore (including cash) on an invested equity of Rs 1,740 crore, PNC stated.

The deal is subject to regulatory and customary conditions, such as clearance from appropriate regulatory agencies, lenders, and other corporate authorizations.

The infrastructure developer confirmed that the acquisition aligns with PNC Infratech’s strategic aim of capital recycling. The company’s disposal of operational road assets intends to capitalise on the Government of India’s ambitious growth ambition for the sector, as emphasised in its statement.

Following this development, the company’s counter hit a new 52-week high of Rs 427.90.

At around 1.09 PM, PNC Infratech was trading 3.04% higher at Rs 398.65, against the previous close of Rs 386.90 on NSE.

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