Welspun Enterprises Updates On Divestment Of Stake In Dewas Bhopal Road Corridor
Welspun Enterprises Limited entered into an Amendatory and Supplementary Agreement to the Share Purchase Agreement with India Infrastructure Fund-II for sale of balance 13% stake in Dewas Bhopal Corridor Private Limited (“DBCL”) for a consideration of Rs. 57.7 crore. The transaction is expected to close within 30 days of the agreement date. This transaction is in line with the Company’s policy of churning its operational assets in order to unlock value.
With this, the Company has completely divested its 50% stake in DBCL for a total consideration of Rs. 184.1 crores as against its fund infusion of Rs. 85.4 crores implying a multiple of 2.15x. DBCL also had an outstanding debt of Rs. 317 crores at the time of the initial agreement, implying an Enterprise Value of Rs. 667.5 crores.
Further, the Company is likely to get approximately Rs. 20 crores as deferred consideration, contingent on obtaining approval for extension of concession agreement from MPRDC. This could potentially increase the Enterprise Value to Rs. 687.5 crores with resultant consideration for Welspun Enterprises at Rs. 204.1 crores. Against the fund infusion of Rs. 85.4 crores, this would imply a multiple of 2.4x.