The Hindu Business Line : Hotel Leela to fund Chennai project mostly through internal accruals

HOTEL Leelaventure's proposal to set up a five-star deluxe hotel in Chennai at a cost of about Rs 250 crore to Rs 280 crore will be financed through a mix of options — by raising private equity, internal accruals and borrowings, company officials said.

Internal accruals would finance 60 per cent to 70 per cent of the project cost, while a little less than one-third of the project cost would be met through borrowings, said the company's Director - Finance and Chief Financial Officer, Mr R. Venkatachalam.

In an announcement to the BSE, the hotel also said that its board meeting held on January 25 approved the re-appointment of Mr Venu Krishnan as Executive Director. The Chennai project would recreate and even surpass the Leela Palace Bangalore. The project would commence in 2005-06 and would be completed in 30 months, Mr Venkatachalam said. He said there would be a small increase in the capital base of the company, currently at Rs 60 crore.

The company is in the process of expanding the Leela Palace Bangalore and is also looking to complete its Udaipur project.

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