GMR Infrastructure rose 3.06% to Rs 19.52 at 14:23 IST on BSE after the company said it divested majority stake in GMR Ulundurpet Expressways to India Infrastructure Fund of IDFC.
The company made the announcement during trading hours today, 17 September 2013.
Meanwhile, the BSE Sensex was up 3.85 points, or 0.02%, to 19,746.32.
On BSE, 7.96 lakh shares were traded in the counter compared with average volume of 11.55 lakh shares in the past one quarter.
The stock hit a high of Rs 19.61 and a low of Rs 18.50 so far during the day. The stock hit a record low of Rs 10.65 on 6 August 2013. The stock hit a 52-week high of Rs 27 on 4 October 2012.
The stock had outperformed the market over the past one month till 16 September 2013, soaring 50.44% compared with the Sensex's 6.15% rise. The scrip had, however, underperformed the market in past one quarter, sliding 3.86% as against Sensex's 2.94% rise.
The mid-cap company has an equity capital of Rs 389.24 crore. Face value per share is Re 1.
GMR Infrastructure announced that GMR Highways has signed a definitive agreement with India Infrastructure Fund (IIF) to divest 74% stake in GMR Ulundurpet Expressways (GUEL). GMR Group will receive a consideration of about Rs 222 crore for the sale of 74% equity stake.
The transaction is subject to closing conditions customary to such transactions. IIF emerged as successful bidder in buying majority stake in GUEL, which attracted strong interest from several major investors from India and abroad. This is a second major divestment in GMR's roads portfolio in less than 6 months, the company said.
GUEL operates the highway stretch of about 73 kilometre (km), from Tindivanam to Ulundurpet on National Highway 45 in the state of Tamil Nadu. The project commenced commercial operations in July 2009.
IIF, which is one of the largest infrastructure focused funds, has a well-diversified portfolio with existing investments in roads, ports, conventional and cleantech energy assets. IIF has investments in several infrastructure entities that operate in the aggregate, over 1,878 lane km of roads in India and this investment will further expand its existing roads portfolio.
Madhu Terdal, Group CFO of GMR Group said, "This transaction signifies GMR Group's ability to successfully implement its Asset-Light-Asset-Right strategy under challenging market conditions. We at GMR Group, continue to focus on creating liquidity and reducing our leveraged position, as part of the strategy of churning of assets. Divestment of this asset will also reduce the debt as on 31 August 2013, by about Rs 459 crore on a fully consolidated basis, in addition to infusing equity funds of Rs 222 crore. The GMR Group will continue to focus in adopting this approach in other businesses as well. This partnership will also strengthen the relationship with IDFC."
M. K. Sinha, Managing Partner and CEO of IDFC Alternatives said, "This investment is our first major acquisition and a step in the direction of implementing our road sector strategy of acquiring control of operational projects with proven traffic history. Given the uncertainty and delays in implementing under construction projects, we will continue our focus on acquisition of operating road assets. This investment also reinforces our desire to stick to partners with whom IDFC has proven and long standing relationships like the GMR Group and we look forward to continue working with GMR in building and operating quality infrastructure assets in India."
On a consolidated basis, GMR Infrastructure reported a net loss of Rs 326.03 crore in Q1 June 2013, higher than the net loss of Rs 94.30 crore in Q1 June 2012. Net sales rose 1.6% to Rs 2614.72 crore in Q1 June 2013 over Q1 June 2012.
GMR Infrastructure is a Bangalore-headquartered global infrastructure major with interests in Airports, Energy, Highways and Urban Infrastructure sectors. It has successfully employed the public-private partnership model to build a portfolio of high quality assets.
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