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DLF shares drop on news of promoters selling stake

DLF shares drop on news of promoters selling stake
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First Published: Fri, May 08 2009. 10 02 PM IST

Taking stock: DLF’s K.P. Singh. Ramesh Pathania / Mint
Taking stock: DLF’s K.P. Singh. Ramesh Pathania / Mint
Updated: Fri, May 08 2009. 10 02 PM IST
New Delhi: Shares of DLF Ltd shed 1.84% to close at Rs240.40 each on the Bombay Stock Exchange (BSE) after media reports said the company’s promoter family would dilute up to 7% stake in the company to foreign and domestic institutional investors to raise Rs2,000-3,000 crore.
BSE’s benchmark Sensex index dropped by 1.98% and the BSE Realty index, comprising 14 realty stocks, declined by 1.13%.
Taking stock: DLF’s K.P. Singh. Ramesh Pathania / Mint
DLF chairman K.P. Singh, his family and other promoters, together hold about 88.55% stake in the company as of March, according to data available on BSE website.
Media reports have said that money raised through the stake sale will be infused into DLF Assets Ltd (DAL), a company that DLF promoters own together with private equity investors. DAL buys contructed properties from DLF and owes the realty firm some Rs4,900 crore from past deals.
Two senior DLF executives, however, said that the media has reported on market speculation. “We do not comment on market rumours,” Ramesh Sanka, group chief financial officer, DLF, said in a text message. Another senior executive at the company, who asked not to be named, denied that the promoters were looking to dilute stake in the firm. “This is not true,” he said. “The promoters will not be diluting stake.”
Until late evening on Friday, DLF had not made any statement to the BSE. Calls and text messages to a company spokesman went unanswered.
In a separate development, a day after a public notice by Bangalore municipality that alleged that DLF was selling apartments in its Westend Heights project in the city without mandatory clearances, the firm sent emails on Friday to its 600-odd buyers saying that it would not violate the law.
DLF said its has obtained various other approvals for the project and would acquire required sanctions from Bruhat Bangalore Mahanagar Palika, the municipal corporation, in time before beginning construction. The company says it expects to give out sale agreements from 20 May and will begin construction in September.
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First Published: Fri, May 08 2009. 10 02 PM IST
More Topics: DLF | KP Singh | Shares | BSE | Money Matters |