Indiabulls to sell 50% in Mumbai assets to Blackstone for ~47.5 bn

In a major real estate deal, Indiabulls Real Estate (IBREL) has executed a definitive agreement with global private equity investor Blackstone Group to divest 50 per cent stake in its prime commercial properties in the megapolis for ~47.50 billion.

IBREL has executed transaction documents with the entities controlled by Blackstone to divest their entire holding in certain subsidiaries and thereby indirectly divesting 50 per cent stake in Indiabulls Properties Private Ltd (IPPL) and Indiabulls Real Estate Company (IRECPL) at an aggregate enterprise value of around $1,461.5 million or ~95 billion, the company had said in a BSE filing on Friday.

“Substantial part of sale proceeds would be utilised towards repayment of existing debts of the company and its subsidiaries, and for achieving sustainable long term growth and for further strengthening of their on-going businesses,” it said.

The transaction is expected to be completed by March 31.

Once this transaction is concluded, Indiabulls will cease its sole control over the two subsidiaries IPPL and IRECPL, Indiabulls added.

The company, did not give any details about the assets held by these two subsidiaries.

However, according to sources, the two subsidiaries hold premium commercial office assets, Indiabulls Finance Centre and One Indiabulls Centre, in central Mumbai.

Indiabulls in April last year had announced plans to restructure its business by creating a separate venture for commercial and leasing operations as part of efforts to focus on each segment.

It planned to hive off commercial and leasing business into a separate entity Indiabulls Commercial Assets.

In a recent announcement, the company said it plans to sell its housing and commercial assets in Chennai as part of strategy to exit non- core market and restructure its business.

The US-based Blackstone directly and along with its joint venture partner Embassy group is currently holding huge commercial assets with over 56 million sqft across major cities.

The transaction is expected to be completed by March 31. Once this transaction is concluded, Indiabulls will cease its sole control over the two subsidiaries IPPL and IRECPL