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India’s Sterlite Power to raise $392m via trust listing

The infrastructure trust, first of its kind by a grid company, will have up to 75% available for allocation to institutional investors.

Sterlite Power Grid Ventures has filed draft papers with the Securities and Exchange Board of India for listing an infrastructure investment trust to raise up to 26.5 billion rupees ($392 million; €370 million). 

The Mumbai-based grid company is preparing to set up the India Grid Trust, or IndiGrid, to be listed on the National Stock Exchange of India and the Bombay Stock Exchange. The trust will own two operating inter-state power transmission assets – Bhopal Dhule Transmission Company and Jabalpur Transmission Company – in the initial portfolio. 

Sterlite Power owns 10 such transmission projects with a total network of approximately 6,767 circuit km, according to its website.   

The offering will constitute at least 25 percent of the outstanding units on a post-issue basis. “No more than 75 percent of the issue shall be available for allocation on a proportionate basis to institutional investors,” the company said in the statement. 

Proceeds from the IPO will be used to repay debt of about 25.8 billion rupees and for other general purposes.

The trust is the first of its kind established by a grid company. In September, Indian road developer IRB Infrastructure Developers registered its IRB InvIT Fund, the very first vehicle since the government revised regulations in 2014. The capital market regulator released the final set of rules this May and has since allowed companies to kickstart marketing campaigns for their trusts.