Clearwater exits Gujarat based Sayaji Hotels

Has sold entire 4.75 million shares to the Dhanani family, promoters of the compnay

Clearwater Capital Partners LLC, a principal investment firm specializing in financial restructurings and distressed investments, has sold its entire stake in Gujarat-based hotel company Sayaji Hotels.

The US-based firm, which held 27.16% stake in Sayaji Hotels has sold its entire lot of 4.75 million equity shares to the promoters of the hotel company, the Dhanani family, at a slight premium.  

Sayaji Hotels has three hotel properties under its belt, one each in Vadodara, Pune and Indore, along with restaurants. It also has two subsidiaries Barbeque-Nation Hospitality and Malwa Hospitality.  

Raoof Razak Dhanani, chariman, Sayaji Hotel, said, "We bought the entire stake held by Clearwater for Rs 130 per share which is a premium than the current share price. The promoters stake in the company has gone up to 67% after the buy-out".

Prior to the stake sale Clearwater has been selling its stake in Sayaji Hotels in smaller lots in the open market. In mid-2006, Clearwater Capital bought 14.92% stake in the company Rs 11.81 crore buying 1.79 million shares at Rs 66 per share.

It later invested in foreign currency convertible bonds (FCCB) issued by the company, this increased its stake to 32.87% after the conversion. Clearwater sold 2.85% stake in 2011 followed by another sale in later months.

Sayaji Hotels had in 2006 issued 75 (0.5%) coupon-secured FCCBs at the rate of $100,000 per bond at 100% of the principal amount due for redemption in 2011. The FCCBs were listed Euro MTF Market of the Luxemburg Stock Exchange. Clearwater planned to converted the FCCBs at Rs 75 a share.

The stake buy has triggered a mandatory open offer of 26% by the promoters. The offer is for 4.55 million shares for Rs 130 per share aggregating up to Rs 59.21 crore. The promoter group presently holds 39.96% or 6.99 million shares in the company.

At today's close the stock price of Sayaji Hotels closed at Rs 124.15, a fall of 4.13% as against the previous day's close of Rs 129.5. Sayaji Hotels has a market capitalising of Rs 217 crore, its revenue as of last year stood at Rs 123 crore while its net profit stood at Rs 1.14 crore.