TheNFAPost Podcast

Bengaluru, NFAPost: The Board of Investment Manager of IndiGrid has designated KKR as a sponsor of the InvIT.

Currently, Sterlite Investment Managers is the sponsor of IndiGrid, India’s first power sector InvIT. KKR and GIC jointly own 60 per cent in this InvIT.

In a filing to the exchanges, Esoteric II, the company which is affiliated with KKR said: “We believe that IndiGrid is a differentiated platform and we continue to be excited about its growth potential. We would like to be sponsors and drive further value creation.”

Nod of sponsor

As a part of the regulatory process, shareholders will now give their nod for the sponsor. We seek to obtain approval from the requisite number of unitholders for being inducted as a sponsor of IndiGrid. We further seek to clarify that providing an exit option to the dissenting unitholders will be at our sole discretion, which will be intimated post declaration of results of the unitholders’ meeting, the filing added.

This development comes a month after, KKR backed off from buying an additional 15% in IndiGrid, from Sterlite Power Grid Ventures Limited (SPGVL). Regulations mandate an entity holding 75% stake in an InvIT to be a sponsor.

“There was an agreement between Esoteric II, and SPGVL to transact on 15% of IndiGrid units. This agreement got automatically expired in July 2020 on the long stop date as the transaction could not be consummated by that date,” said IndiaGrid CEO Harsh Shah.

Institutional investors

Subsequently, on August 14, sold off its 14.7 % stake in India Grid Trust (IndiGrid) to institutional investors and High Networth Individuals (HNIs) for Rs 840 crore. After selling the stake, Sterlite Power will continue to remain a shareholder of Sterlite Investment Managers (SIML), the investment manager of IndiGrid. Sterlite Power is a global developer of power transmission infrastructure with projects of over 13,315 circuit kms and 23,885 MVA in India and Brazil.

Investment in IndiGrid is KKR’s first investment in the infrastructure segment. Global investment funds such as KKR and GIC pumping in $400 million last year.

IndiGrid’s Assets Under Management or AUM is estimated to be Rs 13,300 crore and has ten power transmission projects with a total network of 25 power transmission lines and 7 substations that span 6,080 circuit kilometres across 15 state

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