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Abu Dhabi-based sovereign investor Mubadala said it has teamed up with Canada-based British Columbia Investment Management (BCI) as a new anchor investor in Cube Highways Trust (CHT), an India-based Listed Infrastructure Investment Trust (InvIT).
InvIT’s investment manager, Cube Highways Fund Advisors Private Limited, has announced the listing of its fully subscribed private placement common units for an aggregate amount of Rs 5,220 crore ($630 million).
InvIT has a diversified portfolio of 18 toll and annuity road assets totaling 1,423.60 kilometers.
Mubadala subscribed for the common units along with Canada Pension Investment Manager BCI and other domestic institutional investors.
The first assets held by InvIT will include 17 NHAI toll road assets and one NHAI annuity road asset. These road assets are spread across 11 states including Andhra Pradesh, Bihar, Haryana, Jharkhand, Karnataka, Kerala, Rajasthan, Tamil Nadu States, Telangana, Uttar Pradesh and West Bengal.
In addition, CHT will also have the opportunity to acquire seven highway assets under the right of first offer.
UK Sinha, Independent Director of Cube Highways Funds Advisors, said: “This marks a major milestone in the development of India’s infrastructure industry, especially InvIT. The confidence placed in Cube by these big-name investors is a testament to its capabilities and people.”
InvIT has signed a loan agreement with State Bank of India in the amount of Rs 1,000 crore ($1.2 billion) to refinance existing debt in the initial portfolio,” said Sinha, investment manager at InvIT.
He added that InvIT’s loan facility is rated as “Provisional Ind AAA/Stable” by three rating agencies: Crisil Ratings Limited, ICRA Limited and India Ratings & Research Private Limited.
On strategic investments, Saed Arar, Executive Director and Head of Traditional Infrastructure, Mubadala said: “India has a strong and well-regulated infrastructure investment market, offering the most significant global growth opportunity in the road sector.”
“With over $100 billion allocated for road construction programs and a potential addressable acquisition pipeline of over $20 billion, Cube Highways is the best platform for Mubadala to drive investment in roads and capitalize on this market opportunity,” he said. pointed out.
“As a responsible investor, we are proud to partner with Cube Highways and support India’s road infrastructure ambitions to further bring socio-economic benefits to the country,” he added.
“Our investment in Cube Highways is in line with our long-term strategy of investing in infrastructure platforms to meet the essential needs of the communities they serve,” said Zaman Velji, BCI’s Senior Managing Director, Infrastructure and Renewable Resources.
“Furthermore, this investment increases and diversifies our exposure in infrastructure as well as in India, enabling BCI to contribute to national economic growth. We look forward to working with Cube Highways to create long-term value for our public sector clients , ” he added.
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