Delhi-Based real estate developer BPTP has again received a month's reprieve to deposit the first installment of the Rs 5006-crore Noida land deal - the largest ever land acquisition by a private developer in the country. Now the deadline for the company to deposit the first installment of Rs 1,250 crore with the Noida authority is July 12, which if missed will lead to cancellation of the deal. BPTP has already missed the original April 12 deadline.
BPTP chairman Kabul Chawla told ET, "We will make payment in the next three days. We have enough funds." BPTP, which bagged the 95-acre Noida land deal beating larger rivals DLF, Omaxe and Ansal, had to pay the first installment by April 12. The rest of the payment was to be made in sixteen six monthly installments, along with an interest of 11% compounded annually on the due amount. Unable to pay the first installment, BPTP sought and was granted 60 days' relief, which ends June 12. The company has now got the deadline extended to July 12. BPTP will have to pay an interest of 14% on the due amount for the extended period. In the case of cancellation of the deal, BPTP will have its earnest deposit of Rs 100 crore forfeited by the Noida authority.
"There is a provision for 90 days extension and that's why we sought it. There is no problem of fund raising," Mr. Chawla said. Following the land deal, the company has raised $160 million (approx Rs 640 crore) through stake sale in its SEZs to Citigroup's realty arm Citi Property Investors (CPI). The money, however, is not enough to pay for the land deal. Mr. Chawla didn't disclose from where he had raised the additional funds to be able to make payments in three days. The company's reserves are likely to be too small to fill the gap. BPTP clocked a turnover of around Rs 1,100 crore and a net profit of Rs 220 crore in FY08. The company is said to be in talks with more international investors to raise debt to fund the land deal. The consortium comprising BPTP and its three subsidiaries had offered a rate of Rs 1, 30,207 per sq meter to win the bid for 95-acre land on March 12.
Courtesy: ET dtd - 05-06-08