Bahrain-based Gulf Finance House EC, an Islamic investment bank, has raised $630 million in private equity for its $2 billion Energy City India project.
MUMBAI: Bahrain-based Gulf Finance House EC, an Islamic investment bank, has raised $630 million in private equity for its $2 billion Energy City India project.
Energy City India, part of the infrastructure projects that Gulf Finance House is building at multiple locations, will be spread across over 300 acres in Navi Mumbai, and is expected to house companies in the entire oil and gas value chain. The offer, which was oversubscribed by 60%, is touted as the most successful equity offer in the bank’s history.
The initial offer size was $395 million, which opened for subscription in May. In October last year, Gulf Finance signed the memorandum with the Maharashtra government to build Energy City India and hired Valuable Infrastructure to carry out a feasibility study and to assist in land acquisition. It plans to directly acquire the land for this project.
Acting CEO Peter Panayiotou said: “We were not expecting the strength of demand that we have seen. The issue was oversubscribed by almost 60%. Our product offers a target total return of 75% over a three-year investment period and because of the precautions we took to build flexibility into our land acquisition programme, we can expand the size of the project and offer this target return to all clients.”
Energy City is the second of three such centres Gulf Finance House is setting up. It raised $500 million last year for Energy City Qatar.
The company is looking at more investment opportunities in the country. “We believe that there is still a lot of demand for opportunities to invest in India, particularly in projects that develop economic infrastructure,” said Panayiotou.
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