MUMBAI | BENGALURU: Representatives of the family of VG Siddhartha and US buyout fund Blackstone have agreed to resume talks for the potential sale of a 90-acre technology park owned by the Coffee Day group at an estimated value of about Rs 3,000 crore, according to people directly aware of the development. If successful, the deal will help alleviate the debt burden left behind by the coffee tycoon, who jumped to death on Monday evening.Bankers and investment advisers associated with the property have indicated willingness to revive talks with the world’s largest buyout fund for a potential transaction, sources said.“There were negotiations with representatives of Siddhartha’s family. However, at this point, we cannot say how soon these negotiations can be converted into a transaction,” one of the persons told ET. Blackstone declined to comment. An email query to Coffee Day Enterprises (CDE) did not elicit a response till press time Thursday.If a transaction happens, it will help Coffee Day Enterprises substantially reduce its debt and focus on putting the group back on track, the sources said.Blackstone Focused on Indian RealtyRegulatory filings show the total debt of CDE stands at Rs 6,547 crore, which includes loans from banks and securities sold to mutual funds.As reported by ET, Siddhartha is also estimated to have taken on debt of more than Rs 1,000 crore through entities that housed his personal holdings.Coffee Day group’s subsidiary Tanglin Retail Realty is the developer of the IT-focused Global Village Tech Park that has 4.5 million square feet of built-up area.In a purported note, which surfaced on Tuesday, the late Siddhartha had estimated the tech park will earn Rs 250 crore in rentals over the next 12 months. The park has the potential to add 5 million square feet of built-up space. The Coffee Day group, through Tanglin, also owns Tech Bay, a 21-acre riverfront property in the coastal city of Mangaluru.Talks between Blackstone and Siddhartha had reached an advanced stage last December, with both sides close to signing a term sheet, said people in the know. However, progress was stalled when Siddhartha decided to prioritise the sale of his stake in Mindtree to L&T. That deal was finalised in May.In his final letter to the “Coffee Day family”, Siddhartha had estimated the value of Global Village at about Rs 3,600 crore. In its annual investor presentation in March 2018, the Coffee Day group had said the tech park had total let-out office space of more than 3.3 million sq ft. It counts multinationals such as Accenture, Texas Instruments and NTT Data among its clients. Mindtree’s head office is also located within the facility.Blackstone, the world’s largest alternative assets manager, has been actively acquiring commercial office space in India over the past few years. The private equity firm started investing in Indian real estate four years after opening its local office in 2005.It is currently the largest commercial real estate owner in India with 120 million sq ft, of which including 20 million sq ft is under development.The realty sector has become a focus of Blackstone’s India investments and this will continue, chairman Stephen A Schwarzman told ET in December. “We operate in the most transparent side of Indian real estate … we intend to continue with our strategy,” he had said.
from Economic Times https://ift.tt/2OD4grK
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