L&T Streamlines Portfolio with Divestment of L&T Infrastructure Development Projects

On April 11, 2024, Larsen & Toubro (L&T), a leading engineering, procurement, and construction (EPC) projects operator in India, announced a significant strategic move. The company completed the divestment of the entire 51% stake in L&T Infrastructure Development Projects Limited (LTIDPL), a joint venture established with the Canada Pension Plan Investment Board (CPP Investments). This transaction signifies the company’s ongoing efforts to optimise its portfolio and enhance shareholder value.

A Pioneering Force in PPP Infrastructure Development

Established as a joint venture, LTIDPL played a pivotal role in pioneering the Public-Private-Partnership (PPP) model for infrastructure development in India. This model leverages private sector expertise and investment alongside government participation to accelerate critical infrastructure projects. Through LTIDPL, L&T and CPP Investments collaborated effectively, contributing to the nation’s infrastructure landscape.

Strategic Divestment Aligns with Growth Objectives

The decision to divest LTIDPL aligns with L&T’s long-term strategic vision. The company seeks to streamline its portfolio by focusing on core engineering and construction businesses. This divestiture reduces L&T’s exposure to the asset-heavy model associated with developmental projects like those undertaken by LTIDPL. By transitioning away from asset ownership, L&T aims to improve their return on equity (ROE).

“This transaction marks the achievement of a significant milestone towards the execution of our strategic Lakshya 2026 plan and also provides a conducive environment for growth to L&T IDPL under Edelweiss Alternatives. The transaction is the culmination of a long journey for L&T that started in the early 2000s in the Developmental Projects business, and I have no doubt that the portfolio of good quality assets and team of IDPL will add value to the Infrastructure Yield Strategy of Edelweiss Alternatives platform going forward. I would also like to thank the concession authorities and lenders to IDPL for their valuable support to this divestment”. Mr D.K. Sen, Advisor to CMD & Head of Development Projects, said.

About Larsen & Toubro Ltd

Larsen & Toubro Ltd is an Indian multinational company engaged in EPC projects, hi-tech manufacturing, and services. The company enjoys a rich presence in more than 50 countries worldwide. On April 12, 2024, the shares of L&T opened at ₹3,753.75 and touched the day high of ₹3,753.75 at 09:40 AM.

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