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What are the key conditions regarding qualification of Sponsor(s)?

Bhagat
Answered on February 17,2020

The term ‘sponsor’ means any company or LLP or body corporate which sets up the InvIT. Each sponsor must have a net worth of not less than US$15.38 mn if it is a body corporate or company; or Net tangible assets of value not less than US$15.38 mn in case of an LLP.

The sponsor(s) together shall hold not less than 15% of total units of InvIT on a post-issue basis for a period of at least 3 years from the date of listing, subject to following:

a) Sponsors would be responsible to the InvIT for all acts, omissions and representations/covenants;

b) Sponsor/associate of the sponsor shall act as the project manager for a minimum period of 3 years unless a suitable replacement is appointed by unitholders. However, this conditions shall not apply if the sponsors hold a minimum of 25% stake on post-issue basis for at least 3 years from the date of listing

c) Minimum experience of 5 years in infrastructure sector for each sponsor and where sponsor is a developer, at least 2 projects of sponsor should be completed.

Please refer to section 4(d) of SEBI (Infrastructure Investment Trusts) Regulations 2014 at link for more information.

What are the key conditions regarding qualification of Sponsor(s)?

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