DLF promoters plan to sell another 5.5% stake
The Financial Express, May 29, 2009, Page 3
Kakoly Chatterjee, New Delhi
The KP Singh family, promoters of the country’s biggest real estate firm, DLF are planning to sell another 5.5% of their stake to raise around Rs 2,000 crore.
Earlier on May 13, the Singh family sold 9.9% stake to raise Rs 3,860 crore. If the second round of stake sale happens, the promoters stake will come down to around 73.1% from the current 78.6%. Its stake sale was 88.5% before the May sale.
“Institutions have started looking into the company (DLF Ltd) again,” a merchant banking source said. “The Singh family will go for a secondary qualified institutional placement (QIP) since the money will come to the promoters,” he said. Since they are majority owners of DLF Assets Limited (DAL), they can use these funds to offload the debt on its books.
However, when contacted, Rajiv Talwar, group executive director, DLF denied about the possibility of any further promoter stake sell.
Last month when the promoters of DLF sold 9.9% stake in open market transaction to raise Rs 3,860, it was primarily for paying off hedge fund, D E Shaw which wanted to exit DAL, another K P Singh promoted company. D E Shaw was to be paid Rs 2,000 crore and the rest was infused into DAL to pay off DLF. Currently DAL owes Rs 4,900 crore to DLF. The original plan to list DAL in the Singapore stock exchange had to be scrapped because of the market crash. DAL buys commercial property from DLF and collects lease rentals from it.
Sources said the funds raised from the second round of sale would be used to partly pay off the balance Rs 3,100 crore DAL owes to DLF. The transaction of 9.9% took place at just above Rs 230 per share, which is much lower than DLF’s IPO price of Rs 525 a share. The current transaction is expected to be around the same price. On the previous occasion HSBC, Fidelity, Euro Pacific Growth Fund and Copthall Mauritius Investment Ltd were the other major buyers who made bulk deals on the stock exchange.
Out of a net debt of Rs 13,958 crore that DLF has on its books, it plans to clear off Rs 3,591 crore in the current financial year (FY10). Exit from Delhi Convention centre has fetched them Rs 850 crore, exit from the Bidadi and Dankuni projects has brought to them Rs 336 crore.
The Financial Express, May 29, 2009, Page 3
Kakoly Chatterjee, New Delhi
The KP Singh family, promoters of the country’s biggest real estate firm, DLF are planning to sell another 5.5% of their stake to raise around Rs 2,000 crore.
Earlier on May 13, the Singh family sold 9.9% stake to raise Rs 3,860 crore. If the second round of stake sale happens, the promoters stake will come down to around 73.1% from the current 78.6%. Its stake sale was 88.5% before the May sale.
“Institutions have started looking into the company (DLF Ltd) again,” a merchant banking source said. “The Singh family will go for a secondary qualified institutional placement (QIP) since the money will come to the promoters,” he said. Since they are majority owners of DLF Assets Limited (DAL), they can use these funds to offload the debt on its books.
However, when contacted, Rajiv Talwar, group executive director, DLF denied about the possibility of any further promoter stake sell.
Last month when the promoters of DLF sold 9.9% stake in open market transaction to raise Rs 3,860, it was primarily for paying off hedge fund, D E Shaw which wanted to exit DAL, another K P Singh promoted company. D E Shaw was to be paid Rs 2,000 crore and the rest was infused into DAL to pay off DLF. Currently DAL owes Rs 4,900 crore to DLF. The original plan to list DAL in the Singapore stock exchange had to be scrapped because of the market crash. DAL buys commercial property from DLF and collects lease rentals from it.
Sources said the funds raised from the second round of sale would be used to partly pay off the balance Rs 3,100 crore DAL owes to DLF. The transaction of 9.9% took place at just above Rs 230 per share, which is much lower than DLF’s IPO price of Rs 525 a share. The current transaction is expected to be around the same price. On the previous occasion HSBC, Fidelity, Euro Pacific Growth Fund and Copthall Mauritius Investment Ltd were the other major buyers who made bulk deals on the stock exchange.
Out of a net debt of Rs 13,958 crore that DLF has on its books, it plans to clear off Rs 3,591 crore in the current financial year (FY10). Exit from Delhi Convention centre has fetched them Rs 850 crore, exit from the Bidadi and Dankuni projects has brought to them Rs 336 crore.
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