PNC Infratech Limited, a prominent infrastructure company in India, has successfully concluded the sale of its equity stake in ten operational road assets to Highways Infrastructure Trust (HIT), an Infrastructure Investment Trust (InvIT) backed by affiliates of KKR & Co Inc.
This transaction marks a significant step in PNC’s strategic plan to recycle capital from mature assets into new infrastructure opportunities. The divested assets encompass approximately 3,800 lane-kilometres of national and state highways across key states including Uttar Pradesh, Madhya Pradesh, Karnataka, and Rajasthan. These projects were developed under the Hybrid Annuity Model (HAM) and Build-Operate-Transfer (BOT) models, reflecting PNC’s diverse portfolio in the road infrastructure sector.
The sale was executed in two tranches, with the first tranche involving the transfer of ten Special Purpose Vehicles (SPVs) to HIT. The equity consideration for this tranche amounted to ₹1,827.6 crore, with additional receivables of approximately ₹824 crore expected from change of scope provisions and other stipulated agreements. This divestment aligns with PNC Infratech’s objective to optimize its asset portfolio and reinvest in high-growth infrastructure projects. By monetizing these mature assets, PNC aims to strengthen its financial position and focus on upcoming opportunities in the infrastructure domain.
Highways Infrastructure Trust, with this acquisition, expands its footprint in India’s road infrastructure sector, enhancing its portfolio with revenue-generating assets. The involvement of a globally recognized investment firm like KKR underscores the growing interest of institutional investors in India’s infrastructure landscape. The remaining two assets under the initial agreement are expected to be transferred in due course, subject to the fulfillment of certain conditions precedent. This ongoing transaction highlights the dynamic nature of India’s infrastructure sector and the strategic moves by key players to adapt to evolving market conditions.
As India continues to invest in infrastructure development, such strategic divestments and investments play a crucial role in ensuring sustainable growth and efficient capital allocation. PNC Infratech’s move reflects a broader trend among infrastructure companies to streamline operations and focus on core competencies, thereby contributing to the nation’s economic development.
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