Mumbai:GMR Highways Ltd has signed an agreement with India Infrastructure Fund (IIF) of IDFC Ltd to sell a 74% stake in GMR Ulundurpet Expressways Pvt. Ltd (GUEL) for 222 crore.

“IIF emerged as successful bidder in buying majority stake in GUEL, which attracted strong interest from several major investors from India and abroad," the company said on Tuesday in a statement to the exchanges.

This is the second major divestment in GMR’s roads portfolio in less than six months.

GUEL operates a highway stretch of about 73km from Tindivanam to Ulundurpet on National Highway 45 in Tamil Nadu. The project started commercial operations in July 2009.

IIF, which is one of the largest infrastructure-focused funds, has a well-diversified portfolio with existing investments in roads, ports, conventional and clean-tech energy assets. The fund has investments in several infrastructure entities that operate in the aggregate, over 1,878 lane km of roads in India and this investment will further expand its existing roads portfolio.

Madhu Terdal, group chief financial officer of GMR Group, said his group is focusing on creating liquidity and reducing leveraged position as part of the strategy of churning of assets.

“Divestment of this asset will also reduce the debt as on 31 August 2013, by about 459 crore on a fully consolidated basis, in addition to infusing equity funds of 222 crore. The GMR Group will continue to focus in adopting this approach in other businesses as well. This partnership will also strengthen the relationship with IDFC," Terdal said.

M.K. Sinha, managing partner and chief executive officer of IDFC Alternatives, said this investment is first major acquisition and a step in the direction of implementing road sector strategy of acquiring control of operational projects with proven traffic history.