Actis is acquiring a portfolio of operational Indian Hybrid Annuity Model (HAM) road assets from Patel Infrastructure (PIL), to expand their long-life infrastructure footprint in Asia. Actis has completed the acquisition of two completed assets and is in the process to acquire an additional two assets upon completion.
The acquisition of these assets marks a significant milestone in Actis’ portfolio growth in South Asia while also helping improve the road infrastructure in India. The assets, awarded by the National Highways Authority of India (NHAI), are highly attractive given the availability-based fixed revenues with interest rate indexation features. Given the scalable and attractive opportunity set in India, the roads sector is expected to be one of the key pillars of the firm’s investment strategy in the country, with several other transactions in the pipeline.
Actis’ expertise as builders and operators will help to create a better road infrastructure in India, unlocking potential to drive economic growth across the country. Enhanced road infrastructure will promote connectivity, linking remote regions to urban hubs and facilitating access to essential services, education, and job opportunities. Rural-urban disparities can be reduced, which can further ignite economic activities like trade, manufacturing, and agriculture, contributing to higher GDP and employment rates, setting the stage for a brighter and more prosperous future for India. PIL is a renowned Indian EPC developer and contractor with an established track record of 50+ years.
Actis will focus on improving road safety while also maximising electronic tolling; using recycled asphalt for major maintenance; and installing solar PV on toll plazas and office buildings, highlighting Actis’ commitment to build sustainable value for the communities in which it works.
Adrian Mucalov, Partner and Head of Long-Life Infrastructure at Actis, said, "The acquisition of these NHAI HAM concessions expands our footprint in India, a market where we see huge potential in both the energy and infrastructure sectors. We invest in critical infrastructure in growth markets where governments look to foreign investment to meet that infrastructure demand. Investing in transport systems such as toll roads can lead to more efficient road usage, improved road safety, reduced car idling and pollution, and lead to quicker journeys with lower emissions while increasing connectivity and growth potential.
"The agreement builds on Actis’ experiences in the sector, having already acquired a portfolio of operational toll roads in India in 2022.
Ernst & Young LLP acted as the exclusive financial advisor to Actis on the transaction and Standard Chartered Bank acted as the exclusive financial advisor to PIL.
