The investment is the first direct investment in an Indian infrastructure firm by a Canadian pension fund. The $157 million is only the first installment in CPPIB’s commitment, which totals $314 million.
Details from VC Circle:
Canada Pension Plan Investment Board (CPPIB) has invested Rs 1,000 crore (around $157 million) in L&T Infrastructure Development Projects Ltd (L&T IDPL), a unit of Larsen and Toubro Ltd (L&T), by way of subscription to compulsorily convertible preference shares, as per a stock market disclosure.
The investment, made through CPPIB’s Singapore-based wholly owned subsidiary, is the first tranche of proposed Rs 2,000 crore (around $314 million now) investment that was approved by the Foreign Investment Promotion Board (FIPB), the nodal government body monitoring foreign investment in the country, earlier this year.
The two companies signed a definitive investment agreement in June this year.
“A second tranche of Rs 1,000 crore or such higher amount as may be agreed between L&T IDPL and CPPIB’s subsidiary, will be invested after 12 months from the date of the initial investment, subject to any required regulatory approvals at such time,” L&T said in the statement.
CPPIB manages $234.4 in assets.