L&T Infra to raise $250-300m from PE investors
L&T Infrastructure Development Projects (L&T IDPL) is in talks with private equity investors to raise $250-300 million.
Temasek, Actis and IDFC Project Equity are potential investors, sources with direct knowledge of the matter told LiveMint. The private equity investors are likely to own a 30% stake in the company after the fundraising.
L&T IDPL is a subsidiary of Larsen & Toubro. Based in New Delhi, the company engages in the development of infrastructure projects in India by building roads, bridges, ports and the Metro rail.
L&T has identified L&T Infrastructure Development Projects as its next subsidiary to hit the markets with an initial public offering.
"L&T IDPL has achieved the size where we think it is suitable for listing in the next 12-24 months. We would not look at listing L&T Infotech as it lacks the scale," R Shankar Raman, senior vice-president at L&T Finance, told The Economic Times last year.
According to official estimates, annual growth in India could be as high as 9% if local infrastructure were able to keep pace with the economy. Private equity investment has been one of the engines for India's infrastructure growth, reaching $4 billion in 2010, up four-fold from 2006, according to a 2011 report from Bain & Company. Deal values are also tipped to grow 25-50% annually over the next three years.
IDFC Project Equity, a subsidiary of Infrastructure Development Finance Company (IDFC), will launch its second India infrastructure fund later this year. In 2007, 3i Group held the final close on $1.2 billion for its 3i India Infrastructure Fund and has been looking to raise at least the same amount for its successor, following strong performance.
Last October, Macquarie Group and State Bank of India (SBI) also set a $1-1.5 billion target for their second India-focused infrastructure fund, while SREI Infrastructure Finance is reportedly seeking $1 billion to invest in areas such as roads, power and ports.
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