DLF, the country’s largest realty company, is close to selling its international hotel chain, Aman Resorts, to a US-based investment company for $325 million (Rs 1,800 crore). DLF is to offload its stake in the chain, retaining the Aman property in Delhi only.
Asked for confirmation, a DLF spokesperson said the company did not comment on market speculation.
The US-based company referred to and a Thai-based one were leading the race to buy Aman. According to sources, Starwood Capital Group is leading the race to buy the chain. It is a privately held global investment entity, owned by a little over 60 partners. Founded in 1991 during the RTC real estate crisis, Starwood has completed 465 transactions, representing assets of $35 billion as on June 30. Starwood created and sponsors the SH Group, a hotel management company which owns the Starwood Hotels & Resorts brand.
Recently, in an analyst call, DLF had said the Aman deal was just a few weeks away from closure. “We hope we would be able to announce it in the current quarter itself,” said Ashok Tyagi, chief financial officer.
According to market sources, the US-based investment company has opened an escrow account with DLF for $10 mn (Rs 55 crore). The due diligence will take about a month.
Aman Resorts has been on the block for two years but negotiations did not work out. DLF had blamed the Euro zone crisis and global slowdown for the delay. It said it was not getting the right valuation, since there was a liquidity crunch due to the economic crisis. Earlier, it was in talks with Khazanah, the Malaysian government’s wealth fund, Four Seasons Hotel and Kingdom Holdings, and a Chinese hospitality company.
On the occasion earlier referred to, regarding its wind energy business, Tyagi said, “We have all the regulatory approvals in place required to sell our wind assets, which should take another two to three months,” he said. The company expects to raise Rs 800-1,000 crore from its wind power assets.
This is in part of DLF’s strategy to sell non-core assets to cut high debt.
It expects to close the financial year with a realisation of Rs 5,000 crore from divestment.
The realtor’s net debt increased by Rs 540 crore during the July-September quarter to 23,200 crore but it says this has been reduced to Rs 21,200 crore after the balance payment of Rs 2,000 crore from Lodha’s in November for the Mumbai NTC mill land sale in August. Lodha’s had made an advance payment of Rs 500 crore in August.