Black­stone-Ur­ban In­fra deal col­lapses

HT Estates - - FRONT PAGE - Mad­hurima Nandy mad­

BEN­GALURU A deal that would have given global in­vestor and In­dia’s top com­mer­cial prop­erty owner Black­stone Group Lp a huge leg-up in res­i­den­tial play in the coun­try has col­lapsed.

Black­stone was in ad­vanced talks to buy Ur­ban In­fra­struc­ture Op­por­tu­ni­ties Fund ( UIOF), which has a Rs2,400 crore cor­pus, for around Rs800 crore but the deal fell apart due to a mis­match in val­u­a­tion ex­pec­ta­tions, said three peo­ple fa­mil­iar with the de­vel­op­ment.

UIOF has a large res­i­den­tial port­fo­lio of as­sets and is man­aged by Ur­ban In­fra­struc­ture Ven­ture Cap­i­tal Ltd, which is a sub­sidiary of Anand Jain-led Jai Corp Ltd.

Jain has been closely as­so­ci­ated with Mukesh Am­bani’s Re­liance In­dus­tries Ltd as a strate­gic ad­vi­sor.

“The deal didn’t hap­pen be­cause of val­u­a­tion mis­match between the two par­ties. Black­stone was really keen in ac­quir­ing the port­fo­lio,” said one of the three peo­ple men­tioned above, who did not wish to be named.

Black­stone’s real es­tate arm has com­mit­ted around $4.1 bil­lion across 27 in­vest­ments in In­dia, mak­ing it pos­si­bly the largest owner of com­mer­cial of­fice as­sets in the coun­try.

Sin­ga­pore’s sov­er­eign wealth fund GIC Pte Ltd, which bought a stake in DLF Ltd’s rental arm for Rs8,900 crore last year, would be the other large in­vestor in of­fice projects in In­dia.

“Black­stone has scaled up its com­mer­cial of­fice busi­ness con­sid­er­ably and was look­ing to build a res­i­den­tial in­vest­ment port­fo­lio. Over the last two years, it has also built its shop­ping mall port­fo­lio. It was in­ter­ested to ac­quire the UIOF port­fo­lio be­cause it would get ac­cess to a pan-In­dia spread of projects but the two par­ties didn’t agree on the value,” said a se­cond per­son.

Black­stone de­clined to com­ment on the deal.

A UIOF spokesper­son did not re­spond to email queries.

UIOF is one of two funds man­aged by Ur­ban In­fra­struc­ture Ven­ture Cap­i­tal, the other be­ing Ur­ban In­fra­struc­ture Real Es­tate Fund, which is a $295 mil­lion off­shore fund.

Had the deal closed, Anarock Prop­erty Con­sul­tants was go­ing to be brought in to man­age the res­i­den­tial as­sets in the port­fo­lio.

“Anarock was sup­posed to step in only once the trans­ac­tion was con­cluded but the deal it­self fell apart,” said the third per­son.

UIOF has done around 27 in­vest­ments from the fund across cities.

The fund was launched in mid-2006.

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