BPTP promoters to buy back stake from CPI, JPMorgan for Rs 693 cr

Real estate firm BPTP's promoters will buy back nearly 12 per cent stake held by private equity firms JPMorgan Chase and CPI in the company for about Rs 693 crore.

For this, the company has sold its IT Park BPTP Crest in Gurgaon to Bengaluru-based RMZ Corp for Rs 850 crore. The fund raised from the sale of this information technology park would be used to buy back stakes held by JPMorgan Chase and CPI. The firm is owned by Kabul Chawla.

Earlier this year, Chawla grabbed the headlines for buying a condominium in a super-luxury apartment in New York for about $19 million at a time when it was facing the ire of consumers over delivery delays and poor quality of construction.

Through the sale of the IT park, BPTP would give a complete exit to the Blackstone group, which had invested in this asset in 2007. The IT Park has a fully leased area of about seven lakh sq ft.

"The promoters, the company, CPI and JPMorgan have reached a settlement. The promoters have agreed to buy out CPI's shareholding for Rs 333 crore (payable over a period of time) and JPMorgan's shareholding for Rs 360 crore (payable over a period of time)," BPTP said.

It had raised Rs 322 crore in 2007 from CPI India, a Citigroup fund, now managed by Apollo Management, by selling 5.67 per cent equity stakes in the company.

In 2008-09, the realty firm raised a further Rs 241 crore in two rounds of funding, from Harbour Victoria Investment Holdings, a subsidiary of JPMorgan Chase group of firms, by selling 6.21 per cent stakes in the company.

"Post giving exit to three of our investors, we are now fully focused on completing all our projects at the earliest by raising construction loans through banks/financial institutions," BPTP spokesperson Rohit Mohan said. The company also plans to sell some non-core assets to raise funds for meeting business requirements.

Earlier, BPTP had plans to give exit to CPI and JP Morgan through an initial public offering (IPO). It filed for its draft red herring prospectus in December 2009 and received the SEBI's approval in May 2010. However, BPTP could not launch its IPO due to poor market conditions in the aftermath of the global economic meltdown. Since the public offering was not completed, CPI and JP Morgan initiated arbitration proceedings against the company and the promoters.