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Sterlite Power Grid Ventures Ltd (SPGV), a company that was demerged from Vedanta Group firm Sterlite Technologies, is to raise ₹2,650 crore through Infrastructure Investment Trusts (InvITs), making it the first-ever such issue by an Indian power sector firm. However, the issue follows that of toll-road builder IRB Infrastructure Developers, which closed last week.
SPGV, which is slated to begin road shows this week for a launch on May 17, will sell the units through a sponsored InvIT, India Grid Trust (IndiGrid), sources close to the development told BusinessLine .
“The company is expecting interest from both global and domestic investors, family trusts, life insurance companies, mutual funds and high networth individuals. Upon listing, IndiGrid would utilise the proceeds to provide loans to its subsidiaries Bhopal Dhule Transmission Company Ltd (BDTCL) and Jabalpur Transmission Company Ltd (JTCL), and general purposes,” sourcessaid.
It has mandated Morgan Stanley, Citigroup Global Markets India and Edelweiss Financial Services as merchant bankers and Axis Trustee Services as trustee for the InvIT.
The SEBI-registered InvIT had received regulatory approvals in November 2016.
An independent power transmission company, SPGV owns 10 inter-state power transmission projects with a total network of 29 power transmission lines of about 6,767 ckms and 7 sub-stations with 12,630 MVA transformation capacity. Many of these projects have been fully commissioned, while others are at different stages of development.
Following utilisation of the proceeds, the company’s consolidated borrowings and deferred payments net of cash and cash equivalents will be below 49 per cent of the total value of IndiGrid’s assets, according to the company’s prospectus.
When contacted, the company declined to comment.
InvITs, like mutual funds, enable individuals to pool investments into the infrastructure sector and earn a return on the income (after deducting expenditure). InvITs can invest in infrastructure projects, either directly or through SPVs, while in case of public-private partnership projects, such investments can be made only through SPVs. In India, InvITs are regulated by SEBI and are mandated to be listed.
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