Hotel Leelaventure gains as Marigold Capital agrees to buy Chennai property

NEW DELHI: Shares of Hotel Leelaventure advanced over 5 per cent in early trade on Tuesday after American PE fund Marigold Capital has agreed to buy hotel chain Leelaventure's 326 room hotel in Chennai, ending years of speculation about the potential buyers of the property.

As per the terms, the legal and financial due diligence is underway after Marigold agreed to acquire the asset, said sources familiar with the developments.

The scrip was trading 5.12 per cent up at Rs 24.65 around 9.30 am (IST). Shares of the company opened at Rs 24.80 and touched a high and low of Rs 25.40 and Rs 24.30, respectively, in trade so far. Benchmark BSE Sensex was up 66 points, or 0.21 per cent, at 31,768 at around the same time.

Investment bank JM Financial is the advisor for the sale.

Shares of the company had hit their fresh 52-week high of Rs 27.25 on May 10, 2017 and 52-week low of Rs 15 on November 25, 2016.

ET had previously reported that Marigold Capital and Investments was among the likely contenders to buy the Chennai property. It is estimated that Marigold is buying Leela Palace Chennai located on Adyar Sea Face for around Rs 700 crore. The sea facing hotel boasts 295 deluxe or premiere rooms and 31 suites besides the banqueting space spread over 28,000 square feet.