DLF, India’s largest real estate company by market capitalisation, is set to bid adieu to the Calcutta market by selling its last remaining large asset to a city-based developer as it looks to redeploy resources within the company.
The company has reached a definitive agreement with Calcutta’s Srijan Group to offload the IT-special economic zone spread over 25.9 acres for ₹693 crore.
The DLF Tech Park plot located in Rajarhat has about 1 million square feet of leased office space and vacant land where close to 2 million square feet development can take place.
This is the second asset DLF has put to block in a span of six months — In November last year, DLF’s joint venture firm DLF Cyber City Developers Ltd sold an IT park in Action Area -1 of Rajarhat to a consortium of Calcutta-based Primarc and RDB group for ₹637 crore to monetise the rent-yielding commercial asset.
DCCDL is a joint venture firm between DLF Ltd and Singapore sovereign wealth firm GIC that owns a large portfolio of commercial assets. DLF owns a 66.67 per cent stake, while GIC holds 33.33 per cent in DCCDL.
The transaction with Srijan will be subject to certain conditions precedent, regulatory approvals, consents, sanctions as specified in the transaction documents, DLF said in a regulatory filing. One of the approvals may involve de-notification of the IT SEZ tag.
DLF had entered Bengal during the second term of late Buddhadeb Bhattacharjee’s chief ministership, when the state had managed to attract a legion of industry, including the Tatas.
As the state’s dream of rapid industrialisation withered away at the altar of Singur, many expansive bets taken by national companies failed to take off as envisaged.
In real estate, there are only a handful of national developers working in the commercial space segment in Calcutta, which is yet to attract significant occupiers’ interest compared with Bangalore, Pune or Hyderabad.
According to the exchange filing, the turnover of Calcutta IT/ITeS SEZ business proposed to be sold for FY 2023-24 was ₹86.26 crore, or 2.11 per cent of the turnover of the company. DLF expects to conclude the deal within 12 months.
The transaction was made as part of a business strategy to generate revenue, improving cash flow resulting in an increase in shareholders’ value.
On Wednesday, DLF entered into a master framework agreement with Srijan Realty Private Limited and its subsidiaries for the proposed transaction which will be carried out by a slump sale.
