Ferrovial buys stake in Indian roads company for €740m

Ferrovial’s toll road subsidiary Cintra has agreed to acquire a 24% stake in IRB Infrastructure Trust.

IRB is an investment vehicle that integrates road concessions and construction and has a portfolio of 12 toll road concessions in India, with a pipeline of three more to come. Since its was founded in 1998, it has built more than 18,500 lane kilometers of roads in India.

Ferrovial is acquiring the stake from affiliates of GIC, which currently own a 49% stake of IRB Infrastructure Trust. After the transaction is closed, GIC’s affiliates will retain a 25% stake in IRB Infrastructure Trust and IRB Infrastructure Developers will maintain its current 51% stake.

The total investment amount includes €97 million (US$105.2 million) to fund outstanding equity commitments in projects being developed by IRB Infrastructure Trust.

Commenting on the investment, Ferrovial said, “India’s infrastructure development plans have expanded substantially in recent years with planned capital expenditures of €240 billion (US$260.2 billion) in roads and highways between the years 2020-2025, according to the Indian Department of Economic Affairs report on National Infrastructure Pipeline.

“In this context, IRB Infrastructure Trust is one of the leading platforms in the country with the ability to leverage synergies between a large Build-Operate-Transfer (BOT) developer, a leading financial investor, and a global strategic partner to optimize project planning and selection processes and maximize value creation.”