Adani Road Transport to acquire stake in Maharashtra Border Check Post Network

Adani Road Transport Ltd (ARTL) has signed a deal to acquire a 49% stake in Maharashtra Border Check Post Network Ltd., a subsidiary of Sadbhav Infrastructure Project Limited, at an enterprise value of INR 1,680 crores.

Maharashtra Border Check Post Network has a portfolio of 24 border check posts. Until at least 2033, the company has exclusive service fee collection rights from commercial vehicles for all traffic routes in and out of Maharashtra.

Out of 24 checkposts, Maharashtra Border Check Post Network has 18 operational, four that are near-operational, one nearing completion, and the remaining one under construction.

Maharashtra Border Check Post Network is said to be a major gateway that connects Maharashtra with half a dozen neighboring states, and covers more than 20% of the commercial road traffic in India.

Its annual revenues are expected to be over INR 340 crores, while its debt is estimated to be INR 1,130 crores, as on 30 September 2021.

Adani Road Transport, which develops, builds, operates, and manages roads and highway projects in India, will initially acquire a stake of 49% in Maharashtra Border Check Post Network. The subsidiary of Adani Enterprises has an option to acquire the remaining stake being subject to regulatory approval.

Adani Road Transport to acquire 49% stake in Maharashtra Border Check Post Network

Krishna Prakash Maheshwari — CEO of Adani Road Transport said: “As the nation’s largest infrastructure player, the Adani Group‘s drive to create a world class portfolio of road networks is aligned with our mission to become India’s largest road infrastructure owner and operator. The multibillion dollar profile of road assets we are executing across India encompasses a variety of business models including Hybrid Annuity Mode (HAM), Toll-Operate-Transfer (TOT), Build-Operate-Transfer (BOT) and a service fee based network.

“This acquisition also strategically dovetails with the Adani Group’s formidable strength in logistics, a force-multiplying business adjacency for ARTL.” The acquisition is at an enterprise value of Rs.1,680 Cr implying an attractive EBITDA multiple of ~7x.”

The deal, which is subject to regulatory and lender’s approvals, is anticipated to close in Q3 FY22.