Reliance Infrastructure
Cube Highways and Infrastructure III to acquire Reliance Infrastructure's Delhi-Agra toll road business for $520m. Credit: vm2827.

Reliance Infrastructure has reached an agreement to sell its 100% stake in Delhi-Agra (DA) Toll Road Private Limited to Cube Highways and Infrastructure III for Rs36bn ($520m).

Proceeds from the sale of Delhi-Agra (DA) Toll Road business will enable Reliance Infrastructure to reduce its debt burden by 25% to less than Rs50bn ($722.15m).

The deal does not include the claim amount worth Rs12bn ($173.32m), which will be filed by DA Toll Road Private Limited with the National Highways Authority of India (NHAI). Once realised, the claims amount will go directly to Reliance Infrastructure.

In a statement, Reliance Infrastructure said: “The transaction is in line with Reliance Infrastructure’s strategic plan of monetising non-core business and focus on major growth areas like engineering and construction (E&C) business.”

“The transaction is in line with Reliance Infrastructure’s strategic plan of monetising non-core business and focus on major growth areas such as engineering and construction business.”

Reliance Infrastructure’s special purpose vehicle (SPV) DA Toll Road Private Limited operates the 180km long six-lane road. It connects the national capital Delhi with Agra on National Highway (NH) 2.

According to Reliance Infrastructure, the project witnessed impressive revenue growth of 25% in the 2018 financial year.

Reliance Infrastructure through its SPVs manages 11 road projects with a total length of 1,000km on a build, operate and transfer (BOT) basis.

The transaction is subject to all necessary approvals and permissions.

Singapore-based Cube Highways and Infrastructure III was established by global infrastructure fund I Squared Capital, and a wholly owned subsidiary of the Abu Dhabi Investment Authority.