IL&FS Seeks to Raise $900 Million From Indian Trust Listings

  • Indian developer also considers local initial public offering
  • IL&FS unit courts overseas partners for local investments

Infrastructure Leasing & Financial Services Ltd. is seeking to raise as much as $900 million from listing trusts comprising road and power assets later this year as the Indian developer and financier itself considers an initial public offering.

The Mumbai-based company would use proceeds from listing infrastructure investment trusts, or InvITs, to develop new projects, Ramesh Bawa, managing director and CEO of IL&FS Financial Services Ltd., an investment-banking subsidiary, said in an interview at his Mumbai office last week. “We are looking at putting some road and power assets in the InvITs that could be listed as early as September,” he said.

IL&FS wants to raise capital for new projects as Prime Minister Narendra Modi is encouraging a 23 percent increase infrastructure spending in India this year to 2.2 trillion rupees ($33 billion) to support growth in Asian’s third-largest economy. GMR Infrastructure Ltd. and IRB Infrastructure Developers Ltd. have also said they are considering raising capital by selling InvIT units.

IL&FS IPO

The 29-year-old closely held company, whose stakeholders include Japan’s Orix Corp. and Abu Dhabi Investment Authority, is itself also weighing an initial public offering in India, Bawa said. The timing on a potential IL&FS listing has not been decided, he said.

At the same time, IL&FS Investment Managers Ltd., which has $3.2 billion under management, is seeking overseas partners to invest in stressed assets in the country, he said.

A spokesman for GMR said Tuesday that the company has applied to the market regulator to create and list InvIT units. IRB said in a stock exchange filing that it is considering selling InvIT units.

IL&FS was incorporated in 1987 as a joint venture between Central Bank of India, Unit Trust of India and Housing Development Finance Corp., according to its website. The Mumbai-based company had total assets of 818 billion rupees at the end of March 31 last year, up from 657.2 billion rupees the year before, according to its most recent results. Its annual profit over the same period rose 2.4 percent to about 2.5 billion rupees.

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