 "Aamby Valley")
The Sahara group would get one last shot on Monday to save the jewel in its crown – the luxury hill city project Aamby Valley – from going under the hammer. A hearing of an application filed by the group last week in the Supreme Court is scheduled for Monday. In July, the court had set September 7 as the deadline for deposit of Rs 1,500 crore in the Sebi- Sahara refund account, failing which the auction process to sell off Aamby Valley, situated off the Pune-Mumbai highway, would commence.
Auction documents reviewed by Business Standard showed that the property spread over 8,000-odd acres and valued at Rs 37,392 crore has been split into three distinct parts. The first portion is the Aamby Valley city development itself, which spreads about 6,761 acres. This land approved for development as hill station and the properties standing on it form bulk of the value. The second is a land parcel of over 1,409 acres, which is contiguous and lies adjacent to the developed area, but approvals for development have been applied for but pending with civic authorities. The third is a separate property of 321 acres situated in Satara, a city south of Pune, about three hours’ drive away. Bidders have the option to either present a composite bid for all three properties or separate bids for each of the three parts.
There was a difference of about 300 acres in the total land available for sale between the city profile and the tender document, both available on the auction website. According to the profile, total area available for sale is about 8,170 acres, a total of three lots in the bid documents comes to about 8490 acres. While this discrepancy appears to be due to a double counting of the Satara land parcel, Business Standard could not independently confirm this. Elsewhere, a foot note in the profile said “Out of Total Land Bank of 8812.5289 Acres of Aamby Valley City, the details of Product Mix, FSI and BUA have been given for 8170.4083 Acres.”
Separately, documents showed that over nearly two decades, the group has managed to monetise only about 319 acres or less than five percent of the massive land bank in Aamby Valley, explaining the group’s keenness to save the property from the distress sale. During the course of the six-year old dispute between with market regulator, the group had vehemently opposed any suggestions to sell this property. Though the court had heeded to its requests in the past, earlier this year, it decided that other options to recover the investors' dues, which now have exceeded Rs 40,000 crore with interest have been exhausted. Though the group has put several alternative proposals before the court in the last few weeks, its spokesperson did not respond to an email seeking comments on whether the deadline has been met and other details.
Putting a price
Nestled in the Western Ghats amid serene climate and scenic beauty, the city sprawls across eight villages – Ambavane, Deoghar, Kolavali, Pethshapur, Pomgaon, Nandgaon, Kumbheri and Visakhar – in Mulshi Taluk near Lonavla in Pune district. Another four villages namely, Shedani, Chandivali, Shiravali and Nandivali would come under the fold, as and when approvals come along. According to company documents, the land bank, about a fifth of which is under litigation, was held in about dozen Special Purpose Vehicles (SPV), apart from Aamby Valley, the main holding company.
In 2011, Sahara had formed these SPVs through a scheme of arrangement to hold specific assets within the city such as the air strip, golf course, villas and school, so as to enable easier management and allow asset specific investments.
The valuation, by Techmech solutions appointed by the official liquidator of Bombay High Court, was done by taking into account these SPVs.
Explaining this, a letter dated June 5 by the valuers, said, “The owners acquired the land for the project through these SPVs. Each of them were formed for carrying out a specific activity and accordingly acquired land in its own name. During discussions it was agreed that most viable and economically feasible method of division is by taking the SPV as the basis of distribution of lots. In consonance with this principle lots are prepared taking every SPV as a separate entity" (see table). The land parcels were valued on the basis of prevailing government rates in these villages and details of the properties sold and re-sold in Aamby Valley was also taken into account.
The mothership & its satellites
Aamby Valley Limited, the mother ship, was vested with almost 1,733 acres of land inside the hill station and around it. Among the dozen SPVs, Qing Ambay City Developers Corporation seemed an important one –Not only does it hold almost half the land in Aamby Valley, it also controlled three other SPVs. Qing has sold 308 acres of land out 319 acres it reportedly monetised. In the past, it has been reported that various celebrities including certain Bollywood actors have purchased villas and luxury apartments in the city.
According to Aamby Valley’s profile detailed by the auctioneers, it has sold more than 700 properties with “many people using it as their first or second homes.” These properties and the land on which they have been built are not part of the auction.
Even though Qing Ambay City has not been able to carry out its core real estate business owing to the Supreme Court embargo, its revenues in 2015-16 stood at a little over Rs 121 crore.
Qing Ambay City lists AVL Royal Apartments, AVL Canal and AVL Villas as its subsidiaries. AVL Royal Apartments owns 1380 acres, while AVL Canal holds 215 acres.
AVL Villas meanwhile was vested with almost 31 acres of land – the lowest among all SPVs created to account for Aamby Valley’s land holdings. AVL Canal’s land includes all of the hydro infrastructure created in Aamby Valley. According to auction documents these include among other things “three man-made lakes, large dams for water storage and water treatment facilities.” The project envisages round the clock water supply for drinking and irrigation through 220 million cubic water source approved by the irrigation department of the Maharashtra government.
Fly, fun & tee off
There are other impressive assets. Aamby Valley Green Golf runs an 18-hole floodlit golf course along with a golf academy spread across 256 acres. The golf course, as has been previously reported, was considered as one of the best courses in the world. Aamby Entertainment Service and AVL Hotels & Resorts hold almost 284 acres. On them are assets like a fancy fountain claimed to be the world’s largest and christened ‘Fountain of Fortune in addition to a theatre with a seating capacity of two and a half Boeing 747s. Aamby Valley Airport Project runs a private airport with 5 parking bays and terminal building and a 1.3-kilometer-long airstrip. The waterdrome for amphibious planes will also be part of the auction.
Fund raising efforts
Sahara’s counsel had earlier told the country’s highest court that Sahara had raised Rs 750 crore by selling its stake in London’s Grosvenor House and refinancing some of its interests in two New York-based hotels. Sahara has also moved an application in the Supreme Court in August 2017 seeking permission fora Rs 10,700 crore investment from a London based company called Victor Koneig UK Limited with Mauritius based RPMG Investment owned fund being the nominee. Victor Koneig UK Limited was incorporated as recently as January 2017. This company has one shareholder holding a single unpaid share. The company with which Sahara wants to sign a deal to get the Rs 10,700 crore funding through Mauritius hasn’t yet stated its business objectives before British regulators in an article of association. While Press Trust of India (PTI) reports suggest that RPMG Investment’s fund has confirmed the Aamby Valley funding, the future of this deal could depend on what the court decides on Monday.
Source: Aamby Valley auction documents
