ACME Solar Holdings Ltd, has hired two investment banks to start work on its proposed infrastructure investment trust (InvIT) amid a prolonged delay in a planned initial public offering (IPO).
InvITs are trusts that manage income-generating infrastructure assets, typically offering investors regular yield and a liquid method of investing in infrastructure projects.
ACME has appointed Barclays and JPMorgan to advise it on the InvIT, which will be a privately placed InvIT i.e. sold only to a select bunch of institutional investors. The company plans to put solar assets worth around 600-800 megawatts (MW) under the investment trust and hopes to raise around ₹2,500 crore-₹3,000 crore through this route.
A successful completion of the InvIT plan will make ACME Solar the first renewable energy producer in India to tap the trust route for raising funds.
Promoted by Manoj Upadhyay, Delhi-based ACME Solar was founded in 2015, to consolidate ACME Group’s solar power business and to tap other solar power prospects. ACME, today, has around 2.3 gigawatts (GW) of solar capacity across 13 states.
So far, only three companies have tapped the InvIT route belonging to either the road or transmission sectors.
In May, Canada’s largest pension fund Canada Pension Plan Investment Board (CPPIB) and Allianz Capital Partners (ACP), part of insurance giant Allianz, invested in the first private InvIT in India—IndInfravit Trust, sponsored by L&T Infrastructure Development Projects Ltd.