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Unitech may have to roll over dues to MFs again

Unitech may have to roll over dues to MFs again
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First Published: Thu, Apr 02 2009. 09 38 PM IST
Updated: Thu, Apr 02 2009. 09 38 PM IST
New Delhi: Cash-strapped property developer Unitech Ltd may have to roll over debt owed to mutual funds for a second time. Unitech has to repay Rs500 crore to mutual funds by 19 April, and if it’s unable to tie up the money by then, the firm may have to seek a rollover of the debt, said people familiar with the situation who didn’t want to be named.
The realty firm had to repay Rs900 crore to mutual funds on 19 January. It repaid part of this and managed to roll over the balance by three months.
The company declined to comment on the possibility of it seeking a second rollover.
Unitech is working on several options for raising money. It recently received around Rs380 crore from Unitech Wireless after the latter closed a $1.2 billion (Rs6,036 crore) deal with Norwegian telecom company Telenor SA. Unitech also sold its 200-room Marriott Courtyard hotel in Gurgaon for about Rs230 crore. It is trying to fast track the sale of its 200,000 sq. ft corporate office in Saket, in south Delhi, to raise around Rs500 crore. Proceeds from the launch of its recent mid-income housing project in Gurgaon may also be considered.
Still, a person in Unitech who didn’t want to be named said the exercise may not be easy. “There are a lot of repayment commitments that Unitech has to adhere to, so we may just try and rollover the repayments owed to mutual funds,” said the person.
Unitech has debt of at least Rs8,000 crore on its books. Real estate firms are struggling with a property market downturn and declining valuations as economic growth slows and consumers avoid property purchases in the expectation that prices would slump further.
In January, Unitech filed an application with the Foreign Investment Promotion Board to raise Rs5,000 crore by diluting promoters’ equity. According to the application, the promoters were willing to dilute their equity from their then shareholding of 67.45% to 36.71%. Unitech, however, pulled back the application. As per the company’s last public filing, Unitech promoters have pledged 49.48% of their shares.
cnbctv18@livemint.com
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First Published: Thu, Apr 02 2009. 09 38 PM IST
More Topics: Real estate | Unitech | Property | Mutual funds | Debt |