Indiabulls Real Estate buys back PE investor's stake in 7 projects

At a time when private equity funding has been rather slow in Indian real estate, Indiabulls Real Estate, the realty arm of the Indiabulls group, has bought back the entire stake of FIM, an America-based private equity (PE) fund, in its seven project joint ventures for nearly Rs 1,200 crore.

Farallon's investments in Indiabulls' real estate projects were the first ever foreign direct investments ( FDIs) in the realty sector in India and the PE fund hasmade 1.3 times the return on its investment, made in 2007.

Part of Farallon Capital Management LLC, it held a 49 percent equity stake in these joint ventures and had invested Rs 847 crore in 2007.

"Indiabulls Real Estate has purchased the entire stake of FlM and its affiliates (managed by Farallon Capital Management LLC and its affiliates, in its seven project subsidiaries for a total consideration of Rs.1,172.17 crore," said Indiabulls in a statement on Sunday.

 Indiabulls Real Estate buys back PE investors stake in 7 projects

With the purchase of Farallon's entire stake, these project subsidiaries will now be 100% owned by Indiabulls Real Estate.

With the purchase of the stake, these project subsidiaries will now be fully owned by Indiabulls Real Estate Ltd.

The Indiabulls stock was trading about 2 percent higher while the BSE Sensex was down more than 1.2 percent.

These project companies are currently building residential apartments over 120 acres in Gurgaon, 160 acres in other areas of Delhi and the National Capital Region (NCR), and 15 acres in Chennai.

Late last year, Indiabulls Real Estate sold a 35 percent stake in its arm, Indiabulls Infra Estate, for Rs 1,000 crore.

Indiabulls Real Estate's first quarter profit has been a little more than double from a year before, to Rs 70.2 crore.

Revenue also more than doubled to Rs 508 crore in the three months ended June.

The net worth is Rs 6,830 crore and it is developing 73 million sq ft across Mumbai, the NCR and Chennai.

The company has constructed One Indiabulls Center and Indiabulls Finance Center, the two commercial buildings in Mumbai which house Tatas, Birlas and Reliance in the same complex and also serve as headquarters to leading banks and finance companies.

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Updated Date: Dec 20, 2014 22:46:19 IST