Private equity firm KKR withdraws intention to sponsor India Grid Trust

MUMBAI: Private equity firm KKR has backed off a plan to become a sponsor of India Grid Trust, or IndiGrid, an infrastructure investment trust (InvIT).

In May 2019, KKR – in a first of its kind transaction – had invested Rs 1,084 crore in the InvIT set up by Sterlite Power Transmission. GIC Infra Holdings had chipped in Rs 980 crore.

According to the deal terms, KKR affiliate Esoteric II Pte got 23% units of the trust with an option to buy a further 15% by July 15 this year.

However, KKR has not purchased the additional stake before the agreed upon deadline, IndiGrid said in a disclosure to the bourses.

“KKR has withdrawn its intention to be designated as a sponsor of IndiGrid. A sponsor has the right to acquire more than 25% units, which meant that if IndiGrid went for capital raising, there would have been a large financial investor to put, say, 50% of the money; capital is far more secure. Now we need far more people to invest,” IndiGrid CEO Harsh Shah told ET.

KKR continues to be the single largest unit holder in the InvIT and owns a majority stake of 60% in Sterlite Investment Managers, the manager of the trust.

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