NIIF seals fourth deal of 2022 from infrastructure-focused Master Fund
National Investment and Infrastructure Fund (NIIF), a quasi-sovereign fund manager backed by the Indian government, has struck its fourth deal since January in the infrastructure sector.
NIIF said Wednesday it is partnering GMR Airports (GAL), the airport business holding entity and a subsidiary of GMR Airports Infrastructure, to invest in the equity capital of three airport projects. These include greenfield international airports at Mopa, Goa and Bhogapuram, Andhra Pradesh.
The transaction envisages NIIF making a primary investment of Rs 631 crore ($75 million) in the form of compulsory convertible debentures in GMR Goa International Airport Limited (GGIAL), a special purpose vehicle to run and operate the new Goa airport. This will be NIIF’s first investment in an airport asset in the country and its first direct investment in the state of Goa.
GGIAL, in 2016, was awarded the concession to develop and operate a second airport in Goa on a design-build-finance-operate-and-transfer basis. The Mopa airport is a greenfield airport PPP concession awarded by the state government. The airport has already received an aerodrome licence. Upon commissioning, it will form part of the first dual-airport system in India alongside Dabolim airport.
In the first phase, Mopa International Airport will have a design capacity of handling up to 4.4 million passengers per annum, with an ultimate capacity of up to 40 million passengers per annum.
GAL is a partnership between India’s GMR group and Groupe ADP, which is majority owned by the French government. It has developed and operated airports in over nine countries. It presently operates five airports—the Delhi, Hyderabad and Bidar airports in India, Kualanamu Airport in Medan, Indonesia, and Mactan Cebu Airport in Philippines.
In addition to Mopa International Airport, GAL is also developing the upcoming airports in Bhogapuram, Andhra Pradesh, and in Crete, Greece and awaits signing of the concession agreement of Nagpur airport, which is a brownfield project.
Vinod Giri, Managing Partner at NIIF’s Master Fund, said: “NIIF believes that Mopa international airport will boost air connectivity to the state and provide strong tailwinds to the tourism linked economy of Goa.”
NIIF’s Master Fund is India’s largest infrastructure fund and has built a diversified portfolio across ports and logistics, renewables, smart meters, roads and digital infrastructure. NIIF’s investment in Mopa airport will be the Master Fund’s sixth investment.
The NIIF makes both direct investments in infrastructure and other sectors as well as Limited Partner commitments to private equity and venture capital funds. It manages more than $4.5 billion of equity capital commitments across a Master Fund, the fund of funds, and a Strategic Opportunities Fund (SOF).
The Master Fund mainly invests in operating assets in core infrastructure sectors such as transportation and energy. The SOF focuses on sectors such as financial services, food and agriculture, healthcare and education.
Earlier this year, the SOF made its maiden investment in the digital ecosystem with an investment in FirstCry. Last year, it invested $287 million in TPG-backed Manipal Hospitals. It had also pitched in to create two interlinked infrastructure-oriented debt finance companies.
The Master Fund has been the most active this year, with three other deals, all in the roads sector. In August, NIIF bought a road project from Shapoorji Pallonji Group’s SP Jammu Udhampur Highway Ltd for $290 million.
It also announced the acquisition of Navayuga Quazigund Expressway, another road asset, at an enterprise value of around $380 million. In April, the NIIF signed an agreement to acquire GVR Ashoka Chennai ORR Ltd for Rs 686 crore ($89.5 million) from Mumbai-listed Ashoka Buildcon Ltd.