Ceylinco, Shriram in real estate joint venture

Ceylinco Consolidated, Sri Lanka's largest corporate entity, and Shriram Properties Ltd on Tuesday signed an agreement to partner each other in the Indian property development space.

To begin with the joint venture will build two integrated townships, one in Bangalore and the other in Chennai, Murali, the chief executive officer of Shriram Properties told reporters here on Tuesday.

"The townships will be of 100 acres each and the total cost of the projects will be around Rs 600 crore," Murali told Business Standard. Work is expected to start after Shiram and Ceylinco bring in a third investor, based in United States, he said.

"We are talking to two firms in the US, and will finalise the deal in the next two to three months, he said." The equity holding in this new joint venture would be decided after the US partner was finalised, he said.

The two integrated townships will together put on the market some four million sq.ft of built space, a fourth of which will be commercial space. The rest would be residential, he said.

In Bangalore, the township is to come up in Bangalore East, "on the periphery, between the International Technology Parks Limited and the proposed international airport in Devanahalli."

In Chennai, the companies were in advanced stages of deciding between two locations, one on Old Mahabalipuram Road and the other on Grand Southern Trunk Road, he said.

Ceylinco, the largest insurer company in Sri Lanka, already has a joint venture with Shriram on that front to explore business opportunities in countries such as Egypt, Cambodia, Laos, Madagascar and Zimbabwe, through that tie up.

Ceylinco has picked up a 15 per cent equity stake in Armour Consultants, the insurance broking arm of the Shriram group.