DLF to sell 50% stake in 4 projs to PE firms for Rs 3K cr

Realty major DLF plans to divest around 50 per cent stake each in four new housing projects to private equity firms for over Rs 3,000 crore, a senior company official said Sunday. India's largest real estate firm expects to close some of the deals by June and would utilise the funds to improve its cash-flows that have been affected due to slowdown in housing demand. "We are looking for private equity in 4 greenfield housing projects in Delhi-NCR and South India," DLF Chief Financial officer (CFO) Ashok Tyagi told PTI.

He said discussions with few private equity players have started but declined to disclose their names. Tyagi hoped that at least 2-3 PE deals should get closed by June-end. "We are targeting to raise about Rs 2,500 crore by June from 2-3 deals".

Asked about the dilution of stake in each of the 4 housing projects, Tyagi said it would be around 50 percent. On the utilisation of funds raised via private equity at projects level, he said the same would be utilised "to augment the operating cash flow of our development arm DevCo". DLF has divided its real estate business in two parts - DevCo, under which all residential projects fall, and RentCo, which is the rental business from office and retail projects.

"Since sales are slow, we are planning to raise about Rs 3,000 crore through private equity. In the short term, PE fund will be the substitute for the cash flow which would have normally come from sales," Tyagi said. DLF CFO said out of Rs 20,336 crore net debt, nearly Rs 6,500 crore pertains to DevCo.