DLF, the country’s largest real estate company, has signed an agreement to divest all its stake in Galaxy Mercantile Ltd, a joint venture company between DLF Home Developers Ltd and Infrastructure Development Finance Company Ltd (IDFC). The latter will buy the entire stake, for a total of Rs 450 crore.
This is in line with DLF’s strategy to offload non-core assets and cut debt. DLF Home Developers is a wholly-owned subsidiary of DLF and had 71 per cent equity stake in Galaxy. IDFC will buy the entire stake of DLF over the next 12 to 18 months. It has received Rs 200 crore as the first tranche. The balance payment has been linked to various leasing milestones.
A DLF spokesperson said, “This stake sale is in line with our objective of divesting non-strategic assets.” IDFC said, “This investment in Galaxy Mercantile is the first ever by IDFC as a part its strategy to invest in a portfolio of yield-generating office infrastructure assets in major markets around the country.” Galaxy Mercantile owns a 1.3-million sq ft information technology park in Noida.
DLF’s net debt rose to Rs 22,519 crore, up by Rs 1,000 crore, during the second quarter of the current financial year. It aims to cut debt to Rs 19,000 crore by March-end and to Rs 10,000 crore by 2013 through sale of non-core assets.
DLF is also likely to conclude the Aman Resorts deal by early 2012. The company has got final bids from four to five companies and bankers are close to finalising the deal. DLF would offload its stake in the hotel chain, while retaining the Delhi Aman property.
Khazanah, the Malaysian government’s wealth fund, is being seen as the most likely buyer for Aman Resorts. Other prominent bidders include Kingdom Holdings, the company which owns the Four Seasons Hotel, and a Chinese hospitality group, it is learnt.