Mumbai: Canada’s largest pension fund Canada Pension Plan Investment Board (CPPIB) and Allianz Capital Partners (ACP), part of insurance giant Allianz, on Wednesday said that they are acting as anchor investors in the first private infrastructure investment trust in India—IndInfravit Trust.
IndInfravit Trust, sponsored by L&T Infrastructure Development Projects Ltd (L&T IDPL), will initially acquire five operational toll roads and plans to grow in the future through additional investments in road infrastructure in India.
L&T IDPL is focused on developing infrastructure projects with a focus on the road sector and electricity transmission sectors.
CPPIB will invest approximately Canadian $200 million for 30% of IndInfravit units, while ACP has acquired 25% of the units. L&T IDPL will hold 15% of the units.
The remainder of the units have been subscribed by several local and international institutional investors.
The private InvIT was targeting to raise a total of Rs3,200 crore, Mint reported on 30 April.
L&T IDPL will act as a sponsor and its subsidiary will act as the investment manager for the Trust. CPPIB and ACP will also take board positions on the Investment Manager and are looking forward to further invest into Indian road infrastructure and grow the platform.
“This investment allows CPPIB to deepen our relationships with Allianz Capital Partners and L&T IDPL and demonstrates our commitment to investing in India. The rapidly growing Indian economy brings with it a need for sound infrastructure, and we are pleased to be able to support this growth while delivering solid long-term, risk adjusted returns for the CPP Fund," said Scott Lawrence, managing director and global head of infrastructure at CPPIB.
The five toll roads initially constructed by L&T IDPL are spread across four Indian states of Karnataka, Telangana, Tamil Nadu and Rajasthan. These toll roads have been operating for approximately five years now.
“This investment marks a key milestone for us, as it is ACP’s first direct investment in Asia. Infrastructure is a key driver of India’s economy and it is well served by a reliable fiscal and legal policy framework that attracts long-term investors such as ourselves. As such, it fits in with our investment strategy of specializing in core infrastructure assets in attractive markets," said Christian Fingerle, chief investment officer at ACP.