In one of the biggest real estate deals in the country, the board of directors of leading developer DLF has approved a 33.34 per cent stake sale in its rental arm — DLF Cyber City Developers Ltd (DCCDL) — for Rs 11,900 crore to an affiliate of Singapore’s GIC. The deal pegs the value of DCCDL at Rs 35,617 crore, the company declared in a BSE filing late on Friday evening.
In March, DLF had almost finalised a transaction to sell 40 per cent in the rental subsidiary for an estimated Rs 13,000 crore to the GIC affiliate. However, after weeks of deliberation leading up to a long board meeting on Friday, a decision was taken to sell a lower stake.
Promoters K P Singh and family would sell a 33.34 per cent stake in DCCDL to GIC for Rs 8,900 crore. The remaining shares would be bought back by DCCDL for Rs 3,000 crore. The promoters are expected to get net proceeds of over Rs 10,000 crore after tax and a substantial part of this amount will be invested in DLF for debt repayment.
GIC would now move the Competition Commission of India (CCI) for approval while DLF would approach shareholders for a go ahead. This is the second investment by Singapore’s sovereign wealth fund GIC in DLF. In September 2015, GIC had invested about Rs 2,000 crore in DLF’s two housing projects. According to the BSE filing, the deal includes the secondary sale of equity shares, post conversion of cumulative convertible preference shares (CCPS) to Reco Diamond for Rs 8,900 crore and two buybacks of CCPS by DCCDL for Rs 3,000 crore, out of which one buyback shall be before closing and another 12 months later.
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