Larsen & Toubro to exit L&T IDPL business in Rs 27bn deal with Edelweiss platform

Larsen & Toubro (L&T) said that it has signed a deal to sell its entire stake of 51% in L&T Infrastructure Development Projects Limited (L&T IDPL) to a portfolio company of Infrastructure Yield Plus II, for a price of around INR 2,723 crores.

The sale aligns with Larsen & Toubro’s strategy of lessening its exposure to the non-core asset-heavy developmental projects portfolio.

L&T IDPL is a joint venture between the Indian conglomerate and Canada Pension Plan Investment Board (CPP Investments), with the latter holding a 49% stake. It is engaged in developing infrastructure projects in partnership with the Indian and state governments.

Its infrastructure projects span major sectors such as roads, ports, bridges, and urban infrastructure.

Infrastructure Yield Plus II is an infrastructure fund managed by Edelweiss Alternatives.

Larsen & Toubro to exit L&T IDPL business in Rs 27bn deal with Edelweiss Alternatives’ Infrastructure Yield Plus II. Photo courtesy of Batmaniacs/Wikipedia.org.

The infrastructure strategy of Edelweiss Alternatives is centered on investing in quality operating infrastructure assets in core sectors of power transmission, highways, and renewable energy among others.

Edelweiss Alternatives will also be acquiring CPP Investments’ stake in L&T IDPL at an enterprise value of INR 6,000 crores.

Following the acquisition, the infrastructure platform of Edelweiss Alternatives will have a diversified portfolio of 26 assets in 13 states.

The deal is subject to securing applicable regulatory and other approvals and other customary closing conditions.

D.K. Sen — Larsen & Toubro Whole-time Director and Sr. Executive Vice President (Developmental Projects) said: “This development is a significant step towards the execution of our strategic Lakshya 2026 plan and houses L&T IDPL with Edelweiss Alternatives, an established and reputed alternatives platform with a better strategic fit.

“The transaction is a win-win for both L&T and Edelweiss. It will release growth capital for the L&T Group. Also, it will provide Edelweiss Alternatives with access to a good quality portfolio of assets.”