MUMBAI: Piramal Enterprises has entered into an agreement with Canada Pension Plan Investment Board (CPPIB) to set up a $600-million renewable energy-focused infrastructure investment trust (InvIT).
The duo will look to rope in additional partners to increase the size of the corpus. InvITs are a hybrid instrument that own and manage operational and revenue-generating infrastructure assets like roads and power plants, giving investors predictable cash flows and dividends. The billionaire Ajay Piramal-led company and CPPIB will act as the co-sponsors of the InvIT, with the former bringing in $90 million and the latter bringing in $360 million.
The remaining $150 million will be raised from external investors. Piramal Enterprises will be the project and investment manager for the InvIT, which plans to buy 1.5-2GW of cash-generating renewables assets. Piramal and CPPIB “will jointly warehouse seed assets for the proposed InvIT”, the companies said in a statement.
