R-Infra may buy troubled road projects

December 12, 2011

The ride is getting bumpy for many roads developers. But Reliance Infra is making hay out of the current tough environment. Months after it announced that it was looking at distressed road assets in the market, NDTV has learnt that it is in talks with several players including IVRCL, Madhucon Projects and SREI Infrastructure all of who are looking to sell stake in some of their existing projects.

While Reliance Infrastructure hasn’t pinned down on any particular asset as yet, a buyout could happen in the next 1-2 months.

This will be in Tamil Nadu and will have synergies with the company’s existing projects in the state.

It may be eyeing 400 KM of road projects, including IVRCL’s Salem to Kumarapalayam highway and Madhucon’s Madurai to Tuticorin highway.

While the existing developers, many of whom bid for these projects very aggressively aren’t able to keep them viable, R-Infra hopes it can cut interest costs and bring in other efficiencies.

Meanwhile the company is also looking to go global.

It plans to bid for a BOT project in Vietnam and has expressed its interest in a project in Turkey as well but going international could be a challenge as its efforts to make inroads in Sri Lanka & Nepal have still not take taken off.

Source: http://profit.ndtv.com