Real estate News India: Unitech Ltd and its real estate investment unit have been approached separately to sell their stakes in half a dozen industrial enclaves and information technology parks that, according to analysts, are valued at Rs.3,500-4,000 crore.
Unitech on Thursday said the India-focused Unitech Corporate Parks Plc. (UCP) is in talks with an investor for selling Candor Investments Ltd, the holding company for its 60% interest in the six real estate projects.
Unitech said it, too, was separately approached by a third party for a possible acquisition of all or part of its stake in the special economic zones (SEZs) and IT parks and for a strategic alliance for carrying out the remaining development.
It didn’t say if the investor and the third party were the same or even related.
Unitech also said it has suspended talks announced in December for selling its SEZ in Gurgaon, the largest in Candor’s portfolio.
UCP has been in talks with Blackstone Group LP and GIC Pvt. Ltd for the stake sale in Candor, two people familiar with the developments said, declining to be named.
Blackstone and GIC didn’t respond to an emailed query sent on Thursday.
“Given the large size of the deal, it will take a while to close,” a third person familiar with the development said, also declining to be named.
UCP has a 60:40 joint venture with Unitech, one of India’s largest property firms, to develop the SEZs and the IT parks. Additionally, Unitech has a 14% stake in UCP, taking its effective stake in the portfolio to 48%.
The six SEZs and IT parks are being developed in the National Capital Region and Kolkata, totalling 21 million sq.ft, of which about 8 million sq.ft. of space is operational.
Property advisory Jones Lang LaSalle India is advising UCP on the transaction.
Sandipal Pal, an analyst at Motilal Oswal Securities Ltd, said if UCP sells its entire stake in Candor, Unitech will get 14% of the transaction value (in line with its stake in
UCP) even if it decides not to sell its stake in the joint venture or enter into a strategic alliance for developing the projects.
Alternatively, Unitech may decide to sell a portion of its stake in the projects, Pal said.
“In both cases, liquidity of Unitech should improve, while the quantum will be contingent. The developer may use the money to retire debt or for project construction,” he said.
Unitech had a debt of around Rs.6,000 crore as of December.
On Thursday, Unitech’s shares gained 1.61% to close at Rs.14.56 on BSE, while the Sensex fell 0.19% to 22,509.07 points and the S&P BSE Realty index lost 0.44% to 1,476.87 points.