Mukand Limited Signs Term Sheet to Sell Kalwa Land Parcels to AGP DC Infra for ₹506 Crore

Specialty steel and industrial machinery manufacturer Mukand Limited has executed a preliminary Term Sheet for the sale of its surplus land parcels located in Kalwa, Thane. The company announced it has entered into an agreement with AGP DC Infra Private Limited for a total transaction value estimated at approximately ₹506 crore.

Mukand Limited has already secured an initial advance payment of ₹10 crore from the buyer as part of the agreement.

Transaction Structure and Land Details

The deal involves the transfer of prime real estate assets and specific right-of-way access agreements in Village Kalwa, Thane district:

Primary Land Parcels: The agreement covers several land parcels totaling 35,548.93 square meters, which is equivalent to approximately 8.78 acres.

The Northern Access Road: The transaction also includes a portion of land measuring about 1,691.64 square meters (roughly 0.42 acres) with a width of 9 meters. This segment forms part of a larger 2.51-acre block of land situated on the northern boundary of the primary property.

Right-of-Way Agreements: The sale includes non-exclusive, reciprocal right-of-way arrangements. The purchaser will grant Mukand Limited a non-exclusive right of way over the 0.42-acre road portion for a period of 5 years. Conversely, Mukand Limited will grant the purchaser a perpetual, non-exclusive right of way over the remaining portion of the Northern Access Road, which measures approximately 6,818.33 square meters (about 1.68 acres).

The financial consideration for the transaction is structured at a composite rate of ₹55 crore per acre for the land and the accompanying non-exclusive rights of way. The final payout remains subject to adjustment based on the actual physical measurement of the land parcels during joint surveys.

Strategic Objective and Operational Impact

According to Mukand Limited, the primary driver behind this transaction is to unlock the underlying economic value of its idle real estate assets. The company clarified that this sale is purely an asset disposal and does not constitute the sale of an "undertaking" or substantially the whole of its business operations under Section 180(1)(a) of the Companies Act, 2013. As such, the transaction is not expected to have any impact on the daily operations of the company.

The completion of the transaction is contingent upon meeting several customary conditions. It requires necessary regulatory approvals, permissions, and No Objection Certificates (NOCs) from the Government of Maharashtra, the Collector of Thane, local Gram Panchayats, and other relevant administrative authorities.

Additionally, the final sale is subject to a joint physical survey, land demarcation aligned with sub-division orders, and the satisfactory outcome of technical and legal due diligence currently being performed by the purchaser.

Shares of Mukand Limited was last trading in BSE at Rs. 141.15 as compared to the previous close of Rs. 136.80. The total number of shares traded during the day was 37823 in over 466 trades.

The stock hit an intraday high of Rs. 143.80 and intraday low of 135.75. The net turnover during the day was Rs. 5315807.00.

Source : Equity Bulls

Keywords

Mukand INE304A01026 LandSale Kalwa Thane