The Hindu Business Line : Lehman deal: Unitech in final round of talks

New Delhi, May 28 Real estate major Unitech Ltd is in final stages of negotiation with Lehman for a $500-million PE investment in its two commercial projects in Mumbai.

“The two sides have signed a non-disclosure agreement and an announcement could be made as early as next week,” sources pointed out.

According to sources, the investment may come into two SPVs floated by Unitech for the projects in Santa Cruz, and Lehman could pick up stake in the SPVs.

While Unitech officials could not be reached for comment, sources said negotiations were on over the quantum of stake to be picked up by Lehman in the SPVs.

Unitech is planning to sharpen its focus in the Mumbai market over the new two years. Unitech already has a land bank of 350 acres in Mumbai and in next two years the financial hub is expected to contribute more revenue for the company than the National Capital Region.

Both the Mumbai projects would have a combined developable office space of 2 million sq ft in the initial phase. Sources said that one of the projects entails 13 million sq ft of space, of which in the first phase, consisting of 1 million sq ft, will be developed.

“Lehman may pick-up 50 per cent stake in that,” they pointed out.

Unitech portfolio

Unitech, which has a diversified portfolio, has over 3 million square feet of completed development under its belt in the commercial segment, and 21 million square feet under development.

It also has 22 major ongoing residential projects (spread across Gurgaon, Greater Noida, Kolkata, Lucknow and Bangalore) with the total space offering of over 25 million sq ft.

The company is also going bullish on the hotel space, and has inked a management agreement with Marriott for four courtyard hotels in Gurgaon, Noida and Kolkata and with the Carlson Group for managing a Country Inn in Gurgaon. Plans are also on to develop 28 hotels/serviced apartments by 2010, adding close to 5,000 rooms. Unitech’s total income for fiscal ended March 2007 stood at Rs 3,388.3 crore, on a net profit of Rs 1,305.5 crore.