Goldman Sachs will pick up a 5 per cent stake in IL&FS Transportation Networks Ltd, a subsidiary of Infrastructure Leasing & Financial Services Ltd.
Sources said Goldman Sachs would route the investment through its Mauritius-based wholly owned subsidiary — GS Strategic Investment Ltd.
GS Strategic Investment will acquire 83.30 lakh shares of IL&FS Transportation, comprising 5.13 per cent of the equity, for Rs 83 crore.
IL&FS owns around 88 per cent in IL&FS Transportation and the rest is held by IL&FS Employees Welfare Trust (9.7 per cent) and Trinity Capital Ltd (2.7 per cent), a US-based company. Trinity Capital is an investment banking firm that provides financial advisory services to middle-market businesses. The services are in mergers and acquisitions, financial restructuring and private placements of debt and equity.
IL&FS Transportation is in the business of surface transport infrastructure.
The company provides services such as engineering and construction skills as well as financial and economic analysis. It also evaluates projects for potential investment or sponsorship. It is also involved in the operations and management of toll roads.
Investment banking sources said the investment in the IL&FS arm was part of Goldman Sachs’ larger plans for India. Last year, the group announced that it would invest up to $1 billion over the next couple of years in investment banking, broking, real estate, private equity and asset management.
Earlier, Goldman Sachs had signed a partnership agreement with Kotak Mahindra. The duo ended their 14-year-old relationship in March last year with Kotak Mahindra Bank buying Goldman Sachs’ 25 per cent stake each in Kotak Mahindra Capital Company and Kotak Securities.
Senior Goldman officials had then said the group was looking at building a presence in India that was integrated with its global business.
Goldman Sachs had recently invested in the National Stock Exchange. Along with Goldman Sachs, the operator of the New York Stock Exchange, private equity firm General Atlantic and SoftBank Asian Infrastructure Fund have each bought a 5 per cent stake in the National Stock Exchange in a deal valued at $460 million.
Goldman Sachs is now planning to foray into asset management, private wealth management and the commodities market.
Source : The Telegraph