DLF updates on agreement for land acquisition

DLF Ltd has entered into an agreement with Standard Chartered Bank, Singapore Branch, DB International (Asia) Limited, Singapore and Deutsche Investments India Private Limited ('Lender/ Bond Holder') for purchase of privately placed, Listed, Secured, Non-convertible, Redeemable Bonds of face value of ₹ 600 crore on which the Bond Issuer has defaulted in repayment of the said bonds including accrued interest thereon. The said Bonds are secured in favour of Axis Trustee Services Limited ('Bond Trustee'), acting for and on behalf of the Bond Holder on ~72.36 acres of land parcel(s) situated in Gurugram, Haryana ('Mortgaged Land'), owned by the bond issuer of the said bonds and its affiliates.

In view of the default committed by the bond issuer, the Bond Trustee, on behalf of the Bond Holder had initiated proceedings for recovery of its dues under the SARFAESI and conducted auctions of the Mortgaged Land. Considering the development potential of the part of the Mortgaged Land, DLF Home Developers Limited('DHDL'), a wholly-owned subsidiary of the Company, had participated in the process to acquire a part of the Mortgaged Land by bidding for the same. However, DHDL's bid was not accepted by the Bond Trustee on certain technical grounds. The validity of the said SARFAESI proceedings is a matter of ongoing litigation before Debt Recovery Appellate Tribunal, Delhi.

The Company, directly or through its affiliates, intends to acquire overall rights and interest in land parcel admeasuring ~29 acres ('Identified Land') having estimated development potential of upto 7.5 million square feet, after following due process of law. Out of the Identified Land, land admeasuring ~25 acres forms part of the Mortgaged Land. Accordingly, the Company has entered into an agreement with the Bond Holder, wherein the Company will purchase the said Bonds at a negotiated consideration of ₹ 825 crore and would assume the rights of the Bond Holder. The Company is purchasing the bonds as a strategic investment and would be looking at rights under the bonds documentation including enforcement, settlement with the bond issuer including its affiliate(s), after following due process of law and approvals and sanctions as may be required.

Further, the Company, directly or through its affiliates, would acquire rights and interest in the remaining portion of the Identified Land, through separate binding agreements with the bond issuer and its certain Land-Owning Companies/ affiliates.

Shares of DLF Limited was last trading in BSE at Rs. 758.55 as compared to the previous close of Rs. 747.45. The total number of shares traded during the day was 254134 in over 5714 trades.

The stock hit an intraday high of Rs. 778.85 and intraday low of 749.70. The net turnover during the day was Rs. 193234807.00.

Source : Equity Bulls

Keywords

DLF INE271C01023 LandAcquisition Gurugram Haryana