Indian Real Estate Giant Godrej Properties Intends to Invest Rs 400 Crore in DB Realty to Purchase Around 10% of The Company

Indian Real Estate Giant Godrej Properties Intends to Invest Rs 400 Crore in DB Realty to Purchase Around 10% of The Company. A BSE filing by Godrej Properties (GPL) stated that the business intends to invest Rs. 400 crore to purchase a roughly 10% share in DB Realty (DBR) and that the company also seeks to build up a Rs. 600 crore joint platform to carry out slum remediation projects on a 50-50 basis.

Godrej Properties' board of directors, in conjunction with the board of directors of D B Realty, proposes to subscribe to such number of warrants issued by D B Realty, which will be convertible into such number of equity shares aggregating approximately 10% of the issued and paid up capital of D B Realty for an aggregate amount of approximately Rs. 400 crore; and (ii) establish a special purpose vehicle as a joint venture with D B Realty to jointly undertake slum rehabilitation a project in the city of Mumbai.

DBR disclosed its potential subscription to 5,00,00,000 warrants convertible into equity shares in Godrej Properties for an aggregate amount of approximately Rs. 400 crore in a separate regulatory filing.

GPL and DBR would each make a contribution of Rs. 300 crore to the equity platform, which will be utilised to invest in redevelopment prospects in the city of Mumbai.

Although the intended SPV has not yet been established, it will do so at a later date. The special purpose vehicle will serve as a strategic special purpose vehicle, granting GPL ROFR (Right of First Refusal) for all slum rehabilitation and MHADA redevelopment projects identified by DBR across Mumbai under a 50:50 equity partnership with 10 percent development management fees paid to GPL and a service fee equal to 5 percent of the project's revenue paid to DBR by the special purpose vehicle.