Indiabulls realty arm acquires majority stake in Dev Property
Indiabulls Real Estate has decided to take majority stake in Dev Property Developers, the London-listed property fund, in order to gain majority control over two of its prized properties in Mumbai.
By TNN |
MUMBAI: Indiabulls Real Estate (IBREL), the real estate arm of the Indiabulls group, has decided to take majority stake in Dev Property Developers, (DPD) the London-listed property fund, in order to gain majority control over two of its prized properties in Mumbai. IBREL has bought over 90% in DPD for about Rs 1,100 crore. The stake has been purchased from three FIIs ��� Government of Singapore, Fidelity and HSBC.
DPD, which is listed on London���s Alternative Investment Market, in turn holds a minority stake in various realty assets, a majority of which are owned by Indiabulls group, like Jupiter Mills, Elphinstone Mills and the 6,000-acre SEZ at Raigad in Maharashtra. It is expected that the deal would help IBREL launch its Real Estate Investment Trust (REIT) in the Singapore Stock Exchange (SSE). IBREL had received the approval to list REIT at SSE and initiated steps to create a property trust prior to the listing.
Jupiter and Elphinston Mills were purchased by Indiabulls in a series of high-profile transactions in 2005 from state-owned textile firm NTC. Indiabulls plans to convert them into commercial complexes.
The company is believed to have leased out over 80% of Jupiter Mills at over Rs 310 per sq ft, resulting in expected lease rentals around Rs 1,200 crore. These rentals seem to be the other kicker for this deal to have gone through at a premium.
On Thursday, IBREL shares were down by 1% and closed at Rs 647.30 on BSE. The boards of IBREL and DPD announced on Thursday that they have reached agreement and the offer values the existing ordinary share capital of DPD at approximately ��138 million.
At Rs 1,100 crore, the transaction has been done at a premium to the last-traded price of DPD, which was 75 pence while the per share acquisition cost works to ��1 per share for IBREL. Merrill Lynch acted exclusively as financial adviser to IBREL. IBREL had reported Rs 303 crore profit in Q3 of the current fiscal.
DPD, which is listed on London���s Alternative Investment Market, in turn holds a minority stake in various realty assets, a majority of which are owned by Indiabulls group, like Jupiter Mills, Elphinstone Mills and the 6,000-acre SEZ at Raigad in Maharashtra. It is expected that the deal would help IBREL launch its Real Estate Investment Trust (REIT) in the Singapore Stock Exchange (SSE). IBREL had received the approval to list REIT at SSE and initiated steps to create a property trust prior to the listing.
Jupiter and Elphinston Mills were purchased by Indiabulls in a series of high-profile transactions in 2005 from state-owned textile firm NTC. Indiabulls plans to convert them into commercial complexes.
The company is believed to have leased out over 80% of Jupiter Mills at over Rs 310 per sq ft, resulting in expected lease rentals around Rs 1,200 crore. These rentals seem to be the other kicker for this deal to have gone through at a premium.
On Thursday, IBREL shares were down by 1% and closed at Rs 647.30 on BSE. The boards of IBREL and DPD announced on Thursday that they have reached agreement and the offer values the existing ordinary share capital of DPD at approximately ��138 million.
At Rs 1,100 crore, the transaction has been done at a premium to the last-traded price of DPD, which was 75 pence while the per share acquisition cost works to ��1 per share for IBREL. Merrill Lynch acted exclusively as financial adviser to IBREL. IBREL had reported Rs 303 crore profit in Q3 of the current fiscal.
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