Lok, Malaysia Firm In Rs 900cr Plan

Lok Housing and Constructions is floating a 50:50 joint venture with a Malaysian company. The new outfit, which will be based in Mauritius, plans to invest around Rs 900 crore into real estate mainly in Mumbai and its suburbs. The investments from Lok for this venture would mainly be in the form of land which it already has.

A complex computation would be evolved which would ensure that both partners invest identical sums directly or indirectly into projects in India.

Lok had, in an effort to raise capital, recently disposed its plots at Jaipur, New Delhi and Bangalore to different corporate buyers at a total estimated cost of Rs 34 crore. The company hopes to capitalise on sites which could be developed with financing from its Malaysian partner. Lok claims a net worth of Rs 1,000 crore for its various plots in India with a major portion of this accruing from plots in the far western suburbs of Mumbai.

 

It is also floating another separate company which is bidding for completing the Rs 2,000 crore expressway linking Mumbai and Pune. Lok expects the Maharashtra government to participate in the equity of the new company.

Lalit Gandhi, chairman and managing director, Lok, confirmed both arrangements and the plans to float companies, but refused to name his Malaysian partner.

The entire arrangement for the Mauritian overseas corporate body is in the final stage and an official announcement can be expected shortly, he said. Both the joint ventures are yet to be registered but the process for the same is expected to begin in the next few weeks.

The bid for constructing and operating the Mumbai-Pune expressway has become a toss up between Reliance Industries and Lok. The other majors like the Videocon Group, Mukand Industries, Western India and Nippon Denro having been eliminated.

Gandhi said barring a re-tendering, Lok expects to be granted the bid for the construction of at least half the length of the proposed expressway.

However, Lok Housing and Constructions, remains the only company to have presented a non-conditional bid to the state government for this project, though according to industry sources, an unofficial conditional list has been sent to the state government.

The final bidder for the Mumbai-Pune expressway would be allowed to collect a toll for a protracted period. It would also be granted the right to sell advertising space on both sides of the road. Moreover, it would be granted the right to develop 1000 hectares of land within the vicinity of the expressway.

However, in case it is granted the project, Lok expects substantial support from the state government, financial institutions and even the World Bank for the completion of the project. The government is expected to finalise the allotment of this bid very shortly.