New Delhi, Aug. 25 -- Mumbai-based Neo Asset Management's infrastructure investment vehicle Neo Infra Income Opportunities Fund (NIIOF), which is actively deploying capital following its final close last month, on Monday said it has made its first renewable power acquisition.
The fund, which has a mandate to invest in road and renewable power assets, has acquired renewable energy platform SolarArise India Projects Pvt Ltd for an enterprise value of Rs 1,400 crore ($159 million).
"Our team is fully geared up to operate these plants, as well as drive operational and financial improvements to enhance value for our investors," said Abishek Goel, managing director and head of infrastructure and real assets at Neo Asset. The fund's strategy is to invest about 85% of the corpus in road assets, with the rest allocated to renewable assets.
SolarArise owns 433.5 MWp of operational solar assets spread across Maharashtra, Uttar Pradesh, Madhya Pradesh, Karnataka, and Telangana. All projects have 25-year power purchase agreements (PPAs), with about 70% tied to central offtakers and the rest to state discoms.
The latest development comes shortly after Neo Asset announced earlier this month that it has entered into an agreement with HG Infra Engineering Ltd to acquire five assets built by the listed player for an enterprise value of Rs 3,600 crore. These include two sections of the HG Khammam-Devarapalle national highway and three sections of the Raipur-Visakhapatnam national highway.
The fund's first acquisition was a 27.5-km toll road on NH-05 (Chandigarh-Shimla Highway). While it did not disclose the financial terms of the acquisition, the fund's manager had earlier indicated that the ticket sizes are generally in the range of Rs 100-200 crore.
Following that deal, NIIOF said it had around Rs 1,100 crore in dry powder, earmarked largely for hybrid annuity model (HAM) road assets under the National Highways Authority of India (NHAI).
The asset manager originally planned to deploy about 60% of the corpus for road assets and the remaining for solar power assets. However, the managing director of the fund said the strategy has been tweaked to deploy about 85% of the fund's corpus to road assets. At the time, Goel had said due diligence was ongoing for deals worth Rs 2,000 crore and Neo Asset expected to wrap up capital deployment for the fund by the end of March 2026.
In March, the infrastructure investor also announced plans to acquire two road projects in Punjab and Haryana being developed by CDS Infra Projects Ltd for an enterprise value of Rs 1,500 crore, pending NHAI approval.
Neo Asset marked the final close of its maiden infra fund at Rs 2,300 crore in July, surpassing its original target by around 15%. The fund's lifecycle is expected to conclude by September 2030. With targeted gross returns of 18-20% for investors, the fund manager plans to make a consolidated exit from all its portfolio investments by listing them on an infrastructure investment trust (InvIT), VCCircle had reported in July.
Published by HT Digital Content Services with permission from VC Circle.