A Tata company has jointly bid for a four-acre plot put up for long-term lease by the Mamata Banerjee government, the first known instance of the group making a fresh investment proposal in Bengal post the Singur pullout in 2008.
Real estate firm Tata Housing has joined hands with city-based Keventer to try and acquire the prime plot located within the Tollygunge tram depot, belonging to the Calcutta Tramways Company (CTC).
Six other companies are in the fray, including Shapoorji Pallonji that is owned by the family of Cyrus Mistry, chairman of the Tata Group. Sources said the plot could fetch Rs 120-130 crore for the cash-strapped CTC.
“It’s a good indication that the Tatas are thinking of fresh investment in Bengal again. It is certainly a welcome step,” Kallol Datta, president of the Bengal Chamber of Commerce & Industry, said.
While the group has always maintained that the Singur pullout would have no bearing on new investments in Bengal, no such initiative had been in the public domain until the Tata-Keventer bid.
But the group, which deals in everything from steel to salt to software, did go ahead with its expansion plans for a few ongoing projects, including Tata Consultancy Services’ SEZ in Rajarhat and a Tata Hitachi earthmoving equipment unit in Kharagpur.
In 2009, Ratan Tata, the then chairman of the group, had promised during a visit to Calcutta: “Any project that helps the state and makes sense to us, we will look into.”
When Mistry took over the mantle, he toed his predecessor’s line. “I would like to say that the Tatas never left West Bengal and we will never leave West Bengal,” Mistry said at the annual general meeting of Tata Global Beverages Ltd in Calcutta in July 2013, his first official visit as chairman.
A spokesperson for Tata Housing said the bid for the CTC plot in Tollygunge was in line with the group’s India strategy. He said there were plans for the Calcutta market too. “We have aggressive growth plans for the next 3-5 years to expand our presence in the top 8-10 cities in the country. With our presence across the consumer pyramid, as a pan-Indian real estate brand, we would target replicating the same in Calcutta in the near future,” the spokesperson said.
Tata Housing already has two projects in New Town on land allotted during Left rule. “We will be expanding our presence in the premium and luxury market in Bengal,” the spokesperson said.
Sources said Tata Housing was likely to hold a 70 per cent stake in the venture, with Keventer keeping the rest. “We are happy to partner the Tata Group in this venture. We hope to co-operate in more projects going forward,” Mayank Jalan, managing director of Keventer, said.
Officials said a change in the terms and conditions had made the CTC assets put up for lease more lucrative than in the previous round of bidding. The Tollygunge plot had attracted only two bids while Belgachhia, where around one acre is being offered, fetched one.
Apart from Tata-Keventer and Shapoorji, city-based developers Ambuja and Merlin and the National Buildings Construction Corporation Ltd have bid for the plot at the Tollygunge tram depot. “The response indicates that businesses now believe they can do business with this state government,” Debanjan Mandal, partner of solicitor firm Fox & Mandal, said.
Fox & Mandal is advising the transport department in the bidding process. KPMG is the transaction advisor.
In the previous round of bidding, CESC acquired three plots that had been put up for a 99-year lease. The presence of the flagship company of the RP-Sanjiv Goenka Group instilled confidence in bidders for the second round, Mandal said.
Sources said two changes in the bid document made the biggest difference. The successful bidder will now be required to pay 20 per cent of the bid value upfront and 75 per cent at the time of getting possession of the plot.
Previously, a bidder was required to make 95 per cent of the payment upfront and wait for possession.
The time for giving possession of the land to the successful bidder has been reduced from nine months to three months.
Sources said a technical evaluation of the bids was scheduled for Tuesday.