The Capital Quest | KKR Deploys $520M Infrastructure Investment Vehicle in India

Global alternative investment firm KKR announced on Monday that it has launched Highways Infrastructure Trust (HIT), a road infrastructure investment trust (InvIT), its third such infrastructure vehicle in the country as it expands his private equity investment game in India.

KKR’s other InvITs include Virescent Renewable Energy Trust, India’s first renewable energy InvIT, and India Grid Trust, a power transmission InvIT. Together, these platforms operate and manage 33 assets valued at over $3.8 billion in 22 states or union territories across India, KKR said.

The initial offering of HIT through a new issue of 41.6 million units via a private placement totaling Rs 416 crore ($52 million). In total, at the issue price, the InvIT is valued at $520 million. The issue is managed by Axis Capital and the shares will be listed on the National Stock Exchange.

HIT’s initial portfolio comprises six road assets with a total length of over 450 km across six states in India. The assets, which include a mix of toll and revenue roads, are located in Gujarat, Madhya Pradesh, Meghalaya, Rajasthan, Tamil Nadu and Telangana.

Additionally, HIT is considering a pipeline of acquisition targets, including through its sponsor KKR.

The launch of HIT comes amid growing demand to expand India’s road network, the second largest in the world, as passenger and commercial vehicle traffic continue to increase. Currently, India’s road network is responsible for 90% of total passenger traffic and the movement of almost 65% of all goods across the country.

Hardik Shah, Partner at KKR, said: “Highways and roads play a vital role in India’s economic prosperity and connecting its citizens, and we look forward to enabling the creation and expansion of infrastructure. as transportation demand continues to grow.

Globally, KKR’s infrastructure portfolio covers a wide range of sectors, including transportation, renewable energy, power and utilities, water and wastewater, and telecommunications, among others, and manages over $40 billion in assets.

In India, KKR sees transportation, renewable energy and power transmissions as central to its infrastructure strategy. Since establishing its Mumbai office in 2009, KKR has made over 20 investments in India with more than a dozen active portfolio companies today.

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