Shares in Hotel Leela Venture today rallied as much as 15 percent after the company sold its IT park building in Chennai to Reliance Industries for Rs 170 crore, a move that would help the hospitality group reduce its debt of over Rs 4,000 crore.
At 11:13 am, shares of Hotel Leela were up 10 percent at Rs 26.75 while the Sensex was flat at 1950.
Earlier, reports had suggested that RIL may house its 4G operations in this business park. In November last year, the company’s board had approved the sale of the company’s commercial building in Chennai for a consideration of Rs 172 crore. The company had said the sale proceeds will be utilised for reduction of debt.
In an interview with CNBC-TV18, Vivek Nair, vice chairman & MD, Hotel Leela had said the company had plans to reduce debt by Rs 2,750 crore in near future.
The company had a debt of about Rs 4,250 crore, as on January 1, 2012. The company has also made efforts to raise further equity, but could not succeed due to the depressed equity market, Hotel Leelaventure said in a separate filing to
Hotel Leelaventure posted a net loss of Rs 99.65 crore for the third quarter ended December 31, 2011 compared to a net profit of Rs 22.04 crore in the same period last year due to high interest costs and increase in depreciation and staff related expenditure.
With PTI inputs