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Arshiya update on agreements for construction and forward sale of warehouse building at FTWZ, Panvel

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Arshiya announced that the company had previously informed about the completion of the transaction for the monetisation of 6 warehouses located at the Free Trade and Warehousing Zone, Panvel, near New Mumbai (Arshiya FTWZ) with Ascendas Property Fund (India) (APFI).

APFI is a subsidiary of Ascendas lndia Trust (AiT) which is managed by Ascendas Property Fund Trustee (APFI).

The said transaction also covered the terms for construction funding and forward sale of future development of approximately 2.8 million square feet within the Arshiya FTWZ.

In furtherance to the same, Anomalous Infra (AIPL), a wholly owned subsidiary of the Company, has entered into a Deoeiiture Subscription Agreement with Ascendas IT Park (Chennai) (ITPC), which is also a subsidiary of AiT, for the purpose of obtaining construction funding for an aggregate amount of up to Rs 70 crore (the Construction Funding) for the development of a double storied warehouse of 325,503 square feet leasable area ("Warehouse Building") on approximately 22,292 square meters (i.e. 5.5 acres) of land located at the Arsniya FTWZ (warehouse land).

Under a lease agreement to be executed with the Company, AIPL would have long term leasehold rights on the Warehouse Land.

Simultaneously, the Company has also entered into a conditional Share Purchase Agreement with APFI for selling 100% shareholding interest in AIPL to APFI, upon fulfilment of certain conditions precedent including, but not limited to. the completion of the Warehouse Building (the Forward Sale).

The estimated sale consideration for the Warehouse Building is Rs 214.9 crore. This includes deferred consideration of up to Rs 212 crore to be received over four years from completion of the Forward Sale' subject to fulfilment of certain performance milestones by the Company and/or its affiliates.

Upon completion of the Forward Sale to APFI, the Warehouse Building will be leased back under an operating lease arrangement (six years term) to a step down subsidiary of the Company (AL Sub), in consideration for payment of pre agreed rentals by the AL Sub The AL Sub would operate and manage the Warehouse Building and retain any surplus income (post payment of the pre agreed rentals) from the Warehouse Building (which Includes income from value-added services).

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, July 11 2019. 09:19 IST