Amanresorts sale to fund debt pay off, says DLF's Chawla

India's biggest property developer DLF is all set to sell its Amanresorts luxury hotel chain in a management buy-out with an enterprise value of around USD 300 million. The company at present has a debt of around Rs 23,200 crore on its books and it has been working on the sale of non-core assets to bring down the loan.

Amanresorts, with assets including 22 hotels in 12 countries, has been on the block for around two years and Saurabh Chawla, Executive Director of DLF informed the sale however, would not involve their flagship New Delhi hotel. He also clarified that the money incurred from the deal would be largely utilised to trim its debts.
Besides, DLF is also progressing in its divestment programme with plans to sell its wind business. Chawla confirmed that they are fully focussed to complete the deal and it might be done within the current fiscal itself. Here is the edited transcript of the interview on CNBC-TV18. Q: Can you take us through the USD 300 million price and whether you had to make some concession on that pricing, the street perhaps was expecting a bit more and whether the Delhi property eventually will be sold or it is to be retained by DLF?
A: As the press release says, the Delhi property is retained. So this is a deal which is ex-Delhi property and the price is what it is. There have been other suitors for this transaction but we felt that Adrian Zecha, Founder and Chairman of Aman Resorts, being the creator of the other plan, provided a compelling proposition and we have accepted it. Q: How close are you to concluding the sale of the wind business as well because that has also been on the cards, do you expect to announce that transaction in the next few weeks?
A: We are working at it. One cannot time mergers and acquisition (M&A) transactions. The intention is there. We are fully focused in completing that part of our divestment also. I think we are good to go within this fiscal year. Q: That sell-off that you have done to the original owners has raised some question marks on why you chose to sell it back to the original owners and whether or not DLF itself is involved in some of this funding, would you want to clarify on that and why you chose them as your eventual party to sell?
A: No, DLF is not involved in any kind of funding. Once the closing happens, we will be able to see the overall aspect of the deal. There have been multiple suitors, as I said, on this particular asset. It has been a long ride over the last few months and given what Adrian Zencha proposed, we felt that the management is in best capacity to take this brand forward. Q: This will be all cash I assume, what exactly will the money be put in for, will it be to bring down your debt levels or for some of your recent launches because you have a lot of your big bang launches planned for the NCR region?
A: We do not need money for the launches. Launches create money for us. It is a counter argument over there. All the money that we received through the sale of the shares of Amanresorts will be predominantly used for the debt repayment.
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