Equirus Capital acted as exclusive transaction advisors to KNR & Patel.

KNR Constructions, Patel Engineering sell their two road assets to an Essel group company for an enterprise value of ~Rs 850 crs

by Shrutee K/DNS

Mumbai: November 12, 2016: Patel Engineering Limited (“Patel”) & KNR Constructions Limited (“KNR”) today signed a share purchase agreement to sell their entire equity stake in two Road BOT assets viz. Patel KNR Infrastructure Limited (“PKIL”) and Patel KNR Heavy Infrastructure Limited (“PKHIL”) to an Essel group company. Equirus Capital acted as exclusive transaction advisors to the Sellers on this transaction. Both the assets are operational annuity based BOT assets awarded by NHAI. The enterprise value of both assets put together for this transaction has an enterprise value of ~Rs. 850 Crs.  The transaction is subject to certain conditions precedent including lenders and NHAI approvals, customary to transactions of this nature and parties anticipate closing of the transaction within next 2-3 months.

Mr. Ajay Garg, Managing Director of Equirus Capital said “The transaction is in line with the trend seen across the roads sector where institutional money is chasing operational cash-flows and helping in debt reduction of infrastructure conglomerates”. Apart from Equirus Capital exclusive advisors to the Sellers on this transaction, Cyril Amarchand Mangaldas (Delhi) were the legal advisors to the Sellers whereas Luthra and Luthra law offices advised the buyers on this transaction. 

Mr. Rupen Patel, Managing Director of Patel commented that sale of these assets is part of the Monetization plan to improve financial liquidity for ongoing operations. Company further intends to identify such quality assets and seek optimum value which would strengthen overall cash flow position and would help in strengthening the balance sheet.

Mr. K. Jalandhar Reddy, Executive Director of KNR informed that the BOT asset sale is part of KNR Group’s strategy to focus on their EPC business and demonstrates their ability to build and construct good quality assets coupled with timely and efficient churn of invested equity which can be utilized as growth capital. 

About Patel Engineering limited:An ISO 9001:2000 certified, Patel Engineering Ltd. is an integrated construction company specialising in hydro-power generation, irrigation and urban infrastructure projects. It is the only Indian company with experience in RCC, Micro Tunnelling and Double Take Tap Work. The company has established a significant international presence through its technology centric subsidiaries in US and has executed projects across Arabian Gulf, Sri Lanka, Nepal and Bhutan. With its integrated service, the company is well positioned to benefit from the government's planned investment in the infrastructure sector.

About KNR Constructions: KNR Constructions Limited is an infrastructure development company providing engineering, procurement and construction services across various fast growing sectors, namely, roads and highways, irrigation and urban water infrastructure management. The company’s project execution strength is in road transportation engineering projects, i.e. construction and maintenance of roads, highways, flyovers and bridges, wherever integral to the projects undertaken. The company’s strong project management skills help it in timely and successful completion of projects.

About Equirus Capital: Equirus Capital is a full service, mid-market investment bank backed by prominent investors. It was founded in July 2007 by a passionate group of seasoned professionals with the intent of providing best‐in‐class investment banking & related advisory services to the Indian corporates. Over the last 9 years, Equirus has built impeccable credentials across domains & has created a niche for itself in its ability to structure and deliver transactions in‐line with the client requirements. Over 105 successful transactions across capital raising, M&A and repeat business with marquee clients stands testimony to our capabilities. www.equirus.com.