US-based infrastructure investment manager I Squared Capital has agreed to acquire a 100% stake in India’s Jaipur Mahua Tollways (JMTPL) toll road from Malaysia’s IJM for Rs5.25bn ($85m).

The acquisition of JMTPL will initially be for a 74% ownership interest, with the remaining 26% is subject to approval from the National Highways Authority of India (NHAI).

Said to be operational since 2009, the toll road operates under a 25-year concession to toll, operate and maintain a 109km stretch of National Highway 11 in Rajasthan, India.

"We believe Indian toll roads offer attractive risk-adjusted returns and provide direct exposure to the growing consumer economy."

The transaction follows a recent $20m periodic maintenance programme on the road. During the construction period, IJM had invested $50m in equity and shareholder loans.

The road stretch is part of the highway connecting the two cities of Jaipur and Agra.

I Squared Capital partner Gautam Bhandari said: "This investment is based on a well-defined strategy of investing in select infrastructure assets that benefit from urbanisation, a growing middle-class and rising disposable incomes in growth economies.

"We believe Indian toll roads offer attractive risk-adjusted returns and provide direct exposure to the growing consumer economy."

Provides a direct link between two urban centres, the road operates under a time-tested concession agreement framework with features such as annual pass-through for inflation in toll rates and had posted a revenue growth of more than 15% on an annual basis for the past five years.

I Squared Capital focuses on energy, utilities, and transport in North America, Europe and selected high-growth economies.