May 9, 2018 / 11:31 AM / 6 months ago

CPPIB, Allianz buy into Indian infrastructure trust set to list

MUMBAI (Reuters) - Canada Pension Plan Investment Board (CPPIB) and Allianz Capital Partner has agreed to take 55 percent of the units in an infrastructure investment trust backed by a subsidiary of Larsen & Toubro Ltd (LART.NS).

A sign of Larsen and Toubro (L&T) is placed on a road divider in Mumbai, India May 25, 2016. REUTERS/Shailesh Andrade/File Photo

L&T Infrastructure Development Projects Ltd’s (IDPL) is scheduled to list on the market on Thursday.

CPPIB will invest $154.68 million for its 30 percent stake in IDPL, it said in a joint statement with Allianz.

Allianz Capital Partner (ACP), on behalf of Allianz insurance companies, will buy 25 percent of the units in its first direct investment in Asia, the statement said.

The investment will be CPPIB’s third into IDPL after it spent 20 billion rupees ($297 million) in two tranches in 2014.

Infrastructure Investment Trusts (InvIt) and Real Estate Investment Trusts (REIT) invest in rent-yielding assets and distribute most of their income to shareholders as dividends.

IDPL will start trading on May 10 after raising 32 billion Indian rupees through a private placement.

ICICI Securities Ltd and Citigroup are the lead managers on the private placement.

The trust will be the first to be listed on the Indian market in a year after the IRB InvIt Fund (IRBN.NS) and Sterlite’s India Grid Trust (IGTR.NS) drew lukewarm responses in April and May 2017.

L&T IDPL has a portfolio of assets comprising roads, bridges, metro rail in the southern city of Hyderabad, ports and power transmission lines.

($1 = 67.3250 Indian rupees)

Reporting by Promit Mukherjee and Devidutta Tripathy

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