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Mumbai: Indian Real Estate Company Macrotech Developers Ltd, part of the Lodha Group, plans to raise $450 million through a qualified institutional placement, two sources told Reuters, which would see it sell a stake of about 7% to its controlling family.
The proposed stake sale underscores the recent deal boom in Indian real estate, where prices are expected to rise steadily over the next few years, roughly in line with overall economic growth, according to a Reuters poll of experts.
Macrotech operates 85 million sq ft of land and 95 million more is under development. It is known for its premium real estate, including a tie-up with former US President Donald Trump for a building in the Indian financial capital Mumbai.
The company has appointed investment banks Jefferies And to manage the Kotak deal, sources with direct knowledge of the matter said, the fallout from what is identified as a deal is likely to begin this week on stock exchanges.
Sources said the buyers for the stake were yet to be finalised, but Singapore’s sovereign wealth fund GIC and US investment fund Capital Group had shown interest.
Lodha, Jefferies, Kotak and GIC did not immediately respond to an email seeking comment, while Capital Group declined to comment.
A qualified institutional placement helps publicly listed companies raise capital from domestic markets without the usual standard regulatory compliance and allows only institutional investors to participate in the offer.
abu dhabi investment authority India’s largest real estate investment trust (REIT) in September bought a $400 million stake in Embassy Office Parks REIT, while Blackstone filed for a $500 million REIT IPO of its Indian mall portfolio, Nexus Malls, last month.
Rustomjee, another well-known Indian realtor, listed its shares on the Indian stock exchanges last month.
Macrotech operates in both commercial and residential buildings and is betting on the wider real estate boom in India, one of the fastest growing economies in the world.
For the fiscal year ending March 2022, Macrotech’s net profit is set to rise 270% to 12.6 billion rupees ($153 million), while revenue is up 69% to 92.3 million rupees.
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