· Apis Growth Fund II (the “Fund”), a private equity fund managed by Apis Partners LLP (“Apis”), has entered into a binding agreement to acquire a minority stake in L&T Infra Debt Fund Ltd. (“L&T IDF”), a specialised re-financier of operating infrastructure projects in India with a loan book of ~Rs. 8,000 crore[2] and 0%2 non-performing assets since inception
· L&T IDF is a subsidiary of L&T Finance Holdings Ltd. (“LTFH”), part of the Larsen & Toubro Group, one of the largest Indian multi-national engineering and infrastructure conglomerates, with businesses spanning engineering, construction, electrical and electronics manufacturing, IT and financial services
· Apis Growth Fund II’s investment will support the growth of L&T IDF’s loan book across a number of infrastructure subsectors in India such as renewable energy, roads, power transmission, airports and ports
· Apis Partners LLP is a Private Equity asset manager that supports growth stage financial services businesses in Asia and Africa; Apis Growth Fund II investors include leading institutional investors, developmental financial institutions, global banks and insurance companies, sovereign wealth funds, family offices and HNWIs across Europe, North America, Asia, Africa and Latin America
Mumbai, India, 25 April 2019 – L&T IDF, a subsidiary of LTFH, has entered into a commitment for up to 25.1%1 minority equity investment from Apis Growth Fund II, a private equity fund managed by Apis Partners LLP. Out of the total investment amount, 70% is in the form of growth capital for L&T IDF and 30% is for purchase of shares from existing shareholders (subsidiaries of LTFH). The Fund’s investment into L&T IDF will support the growth of its loan book focused on infrastructure projects in India, strengthen its capital structure, and further its technology and digitisation strategy. This long-term partnership will support the Company in accessing low cost international sources of funds which will be utilised to refinance operational infrastructure projects in India.
L&T IDF is a leading Infrastructure Debt Fund Non-Banking Financial Company (IDF-NBFC) in India. It provides long-term refinancing to private sector and PPP (public private partnership) infrastructure projects across multiple high-growth infrastructure sub-sectors including alternative energy projects, such as solar and wind, and highways, that have each completed at least 1 year of satisfactory commercial operations. IDF-NBFCs are a class of financial institutions that were created by the Government of India as a potential solution to the typical challenges in infrastructure financing faced by banks (such as asset liability mismatches and group concentration limits) and to also facilitate investment from pension and insurance funds into infrastructure projects.
L&T IDF, a AAA rated[3] company since inception, has a loan book of ~Rs. 8,000 crore2 across 94 projects, with ~50% of the portfolio guaranteed by a government authority. The Company has had 0%2 non-performing assets (NPAs) since inception. The Fund’s investment will support the growth of the Company’s loan book for current and new infrastructure sub-segments across all clients the Company serves (domestic developers, foreign developers, and private equity players engaged in infrastructure).
Mr. Dinanath Dubhashi, Managing Director & Chief Executive Officer, L&T Finance Holdings Ltd. said “Our IDF business has built significant strengths in core areas of renewable energy, road and transmission financing, resulting in a high quality loan book and consistent returns. This partnership with Apis is a reflection of the value creation that the Indian infrastructure financing space offers to investors looking for sustainable returns in the long term. Apis’ extensive experience in financial services will further strengthen our integration with global financial markets, as we continue on the path of robust growth.”
Mr. Shiva Rajaraman, Chief Executive, L&T Infra Debt Fund Ltd. said “The India infrastructure market offers significant growth opportunities for specialised re-financiers such as ourselves. Through this long term partnership with Apis and the continued support from our promoter shareholders, our IDF platform is well-positioned to tap into these opportunities, as well as maintain leadership position in key areas of the infrastructure refinancing space. Our experienced team of professionals look forward to an exciting journey ahead to create value for all our stakeholders.”
Mr. Udayan Goyal, Co-founder and Managing Partner, Apis Partners LLP said “We are excited to partner with L&T IDF’s experienced team. The Company has an exceptional track record in refinancing high potential infrastructure projects and raising funds at competitive fixed rates in tenors of up to 20 years, whilst maintaining perfect asset quality. We look forward to helping the team to expand its presence in international capital markets and to create further efficiencies through digitisation and the use of technology across its operations.”
Mr. Matteo Stefanel, Co-founder and Managing Partner, Apis Partners LLP said “With India projected to be the fastest growing infrastructure market over the next five years, we are delighted for the Fund to invest in L&T IDF. The Fund’s investment will support the Company in its mission of facilitating infrastructure growth, a critical factor for the development of industry, agriculture and trade in emerging markets. The Company’s mission is fully aligned to Apis’ own objective of assisting in the deepening of the financial sector as a necessary ingredient for the promotion of economic development in growth markets.”
