Home / Companies / News /  Indiabulls Real Estate may raise up  to  1,500 cr via QIP

MUMBAI : Sameer Gehlaut promoted property developer Indiabulls Real Estate Ltd on Wednesday said that its board has approved a plan to raise up to 1,500 crore.

The fundraising is aimed at augmenting the company’s long-term resources and to maintain sufficient liquidity for meeting funding requirements for business activities, existing and new projects and future business growth, the company said in a stock exchange filing.

Indiabulls Real Estate will soon seek approval of its shareholders for the fundraise.

While the board has approved the plan to raise up to 1,500 crore, two people aware of the company’s plans said the eventual fundraising might be smaller in size.

The company will most likely raise funds through the so-called qualified institutional placement (QIP) offering route, they said on condition of anonymity.

“They are looking at raising at least 500-600 crore through the planned QIP, but could raise more depending on investor demand. The plan is to raise the funds sometime in February, once shareholder approval comes in, which usually takes about a month," one of the two people cited above said. “The funds will help the company meet its funding requirements while it awaits closure of the merger process with Embassy group. Once the merger is complete, the combined entity will look to raise a bigger round of fundraising," he added.

The merger between Indiabulls Real Estate and Embassy group is likely to receive final nod by mid of next calendar year, he said. An email sent to Indiabulls Real Estate remained unanswered. An external spokesperson for Embassy declined to comment.

Following the completion of the merger, Embassy will hold a 44.9% stake in the combined listed entity, existing public shareholders of Indiabulls Real Estate will hold 26.2%, while 9.8% will be held by existing promoters and 19.1% by the Blackstone Group and other Embassy investors.

Embassy already holds 14% of Indiabulls Real Estate and will take up the role of the company’s promoter once the merger is complete. Indiabulls Group will finally exit its real estate business through this, and its current promoter Sameer Gehlaut will become a passive shareholder.

ABOUT THE AUTHOR

Swaraj Singh Dhanjal

" Based in Mumbai, Swaraj Singh Dhanjal is responsible for Mint’s corporate news coverage. For the past eight years he has been writing on the biggest deals in private equity, venture capital, IPO market and corporate mergers and acquisitions. An engineer and an MBA, he started his journalism career in 2014 with Mint. "
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