Brookfield to buy Unitech Corporate Parks for £205.9 million2 min read . Updated: 12 Jun 2014, 12:23 AM IST
Brookfield to buy Candor Investments, the holding company for UCP's property interests, subject to certain conditions
Bangalore: Unitech Corporate Parks Plc (UCP), a London Stock Exchange-listed India-focused real estate investment firm, will be acquired by Brookfield Asset Management Inc., a Canadian asset management company, for around £205.9 million (around ₹ 2,034 crore), UCP said on Wednesday.
The agreement says Brookfield will acquire Candor Investments Ltd, the holding company for UCP’s property interests, subject to certain conditions, UCP said after an extraordinary general meeting (EGM)
UCP, which is incorporated in the Isle of Man, is developing six special economic zones (SEZs) and information technology (IT) parks in India. It had formed a 60:40 joint venture with Unitech Ltd, India’s second largest realty company by market capitalization, to develop these assets.
“The independent directors believe that the proposed sale represents a very attractive opportunity for investors to realize strong value from the properties and facilitate a distribution of the proceeds, and I urge all shareholders to vote in favour of the resolutions proposed at the extraordinary general meeting," Donald Lake, chairman of UCP, said in a statement.
Property consultants Jones Lang LaSalle India advised UCP on the transaction.
Last year, UCP was in talks to sell its Gurgaon IT SEZ but the deal did not materialize. In April, Unitech had informed the stock exchanges that UCP was in talks with an investor for selling Candor Investments for its 60% interest in the six real estate projects.
Jones Lang LaSalle (JLL) India was appointed by Unitech Corporate Parks to sell 60% of the stake in the six assets to a buyer. As of now, Brookfield has bought UCP’s share (60%) in all the six assets and Unitech’s share (40%) in four assets.
The four assets were held in two subsidiares by Unitech Ltd.
“The four assets, which include G1 and G2 IT Parks in Gurgaon, N2 in Noida and K1 IT SEZ in Kolkata have been sold off separately to Brookfield," a person involved in the transaction said on condition of anonymity. “This will help Unitech to retire debt of ₹ 1,500 crore."
The entire transaction value for this sale crosses ₹ 3,000 crore.
“This transaction has redefined the interest of foreign institutional equity in Indian real estate," said Anuj Puri, chairman and country head, JLL India. “Hopefully, in the new regime, this is a beginning for bigger transactions."
Unitech at present has consolidated debt of ₹ 6,300 crore. Unitech officials declined to comment on the transaction.
UCP said that it has not been notified of any transfer of Unitech’s remaining equity interests in the special purpose vehicles through which investments in InfoSpace Noida N1 and InfoSpace Noida N3 are held.
In addition, in respect of the InfoSpace Gurgaon G2-IST ("G2") Project, a third party, Gurgaon InfoSpace Ltd (’’GIL’’) holds the title to the land and through a joint development agreement is entitled to 28% of the revenue arising from that project with Candor and the third party in their capacity as shareholders in the G2 Project being entitled to the remaining 72%.