In one of the biggest debt transactions in India’s real estate market – Piramal Fund Management (PFM) has invested Rs 2,320 Crores in real estate developer the Lodha Group. This is the second investment by PFM in the company, following an Rs 425 Crore investment it had made in Lodha Venezia in May this year.
“The use of proceeds will ensure completion of what we believe to be marquee projects in Central and South Mumbai,” said Khushru Jijina, Managing Director of Piramal Fund Management
The Lodha Group is one of the biggest developers in India by volume of sales, recording Rs 8,000 Crores in gross sales in FY 2015-16. The company is currently developing about 43 million square feet of real estate across 28 ongoing projects across India and London. PFM’s investment will be used to replace existing debt and complete several ongoing projects.
“We are seeing momentum building up in our business with sales, deliveries and collections all moving up. This transaction will further strengthen our balance sheet and give us room to further improve our growth,” said Abhishek Lodha, Managing Director of the Lodha Group.
In a statement, the companies said that the deal has been structured as a fixed return, debt instrument with periodic coupon payments. The deal is also said to have appropriate security mechanisms in place including hard asset cover and locked-in receivables.
NDTV Property Team