DLF likely to sell 50% in Saket hotel for Rs 75 cr

IN LINE with its stated strategy of selling hotel projects to raise cash, DLF is close to divesting 50% stake in its soon-to-be-opened 120-room hotel at Saket, New Delhi for around Rs 75 crore to a wealthy individual, people familiar with the matter said. Less than a month ago, the real estate company sold another 60-room property, located adjacent to its mall at Saket, for around Rs 55 crore.
   DLF's 120-room hotel has a management contract with international hotel chain Hilton and will sport the brand Garden Inn. The construction is almost complete and the hotel is due to open in the current quarter. People with knowledge of the proposed deal said an understanding has been reached, but a final agreement is yet to be signed with the buyer and no money has changed hands yet. The likely buyer is understood to be a wealthy individual, who is not involved with any hotel chain.
   As per people familiar with the proposed deal, the hotel has been valued at Rs 150 crore, or Rs 1.25 crore a room. The 60-room hotel sold recently fetched around Rs 1 crore a room.
   DLF's smaller rival Unitech too sold its 198-room property in Gurgaon recently for Rs 230 crore, translating into a valuation of Rs 1.16 crore a room.
   A DLF spokesman denied the development, saying: "This (proposed sale of 50% equity) is not true, we have no such plans." But DLF vice-chairman Rajiv Singh had on Saturday told an analyst conference call that the company plans to sell some of its hospitality projects. Mr Singh though didn't name any property specifically.
   DLF hopes to raise Rs 5,500 crore through sale of "non-strategic assets," including hotels, land parcels and wind power. This is part of its "portfolio adjustments towards liquidity preservation and de-leveraging" exercise.
   DLF is in talks with multiple potential buyers to sell 8-9 hotel plots across India to raise around Rs 900 crore, one person briefed on the matter said. The entire effort at generating cash through asset sale is aimed at ensuring that other more important or ‘strategic' business of the company such as construction of residential projects go unhindered.

                                                                                                      Courtesy HT-06-05-09