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IJM Corporation is reducing its proposed stake in Indian highway concession firm Vijayawada Tollway Pte Ltd (VTPL) to 89.8% from the originally intended 99.97%.
IJM Corporation said in late November in its filing with Bursa Malaysia:
The execution of the Share Purchase Agreement (SPA) was mainly due to the conditional approval of the NHAI for the revised acquisition that IDFC shall hold at least 10% of the issued and paid-up share capital of VTPL
On May 6, 2011, IJM signed an SPA to buy 48.95% of VTPL, for a INR410 million (about US$6.5 million) from IDFC and the Indian Infrastructure Fund (IIF). The new agreement means that IJM will acquire the 38.7% stake in VTPL from India Infrastructure Fund (IIF) to increase its shareholding in VTPL to 89.8% but IDFC will maintain a 10.17%.
IJM will be acquiring some 11 million shares held by IIF and will transfer or waive the zero interest shareholder's loans taken to fund the acquisition exercise for a total consideration of 314 million rupees (about US$5.1 million).
VTPL is a concession to transform an existing four-lane road in the state of Andhra Pradesh to a six-lane road totalling 82.5km on a build-operate-transfer basis.