PE-VC Fund Investments
Krishna Reddy gets Rs.10,000-Cr loan from Oaktree to buy uncle’s 49% in infra player MEIL: report
Oaktree Capital Management has agreed to lend INR 10,000 crore to PV Krishna Reddy, managing director of Megha Engineering & Infrastructures (MEIL), to help him raise funds to buy out uncle and patriarch PP Reddy’s shareholding in the group. MEIL has been valued at nearly INR 30,000 crore. Krishna Reddy and Oaktree signed a pact to this effect last week. This financing line can be drawn till March 2027, by which time Krishna Reddy is expected to buy out PP Reddy’s 49% in the conglomerate.Krishna Reddy intends to avail INR 2,000-3,000 crore of the Oaktree finance facility, as needed. He will also be looking at a combination of asset sales to strategic investors as mutually agreed between the promoters, listing some verticals and, perhaps, even raising pre-listing funding.MEIL is a closely held public company established in 2006 by the Reddy uncle-nephew duo to execute projects on an engineering, procurement and construction (EPC) basis in irrigation, drinking water supply, sewerage treatment, roads, power, hydrocarbon and other areas.MEIL has several high-profile contracts, such as the Zoji La tunnel, the Machilipatnam port and an INR 12,800-crore contract from Nuclear Power Corporation of India to construct two 700MW reactors.The operations and maintenance wing of Olectra Greentech, the only listed entity of the group, may also be hived off to raise funds. MEIL is the promoter of the company that makes e-buses and composite polymer insulators with a 50% stake.
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