Infrastructure major Larsen & Toubro on Monday announced the transfer of its realty business to its arm L&T Realty Properties Ltd.
The development marks the beginning of a phased consolidation of all real estate assets and undertakings of Larsen & Toubro (L&T).
The approval on the same was given by the board through a slump sale via a scheme of arrangement. However, it is subject to requisite regulatory approvals.
"The Board of Directors of L&T has approved the transfer of its Realty Business Undertaking (Realty BU) to L&T Realty Properties Ltd (L&T Realty), a wholly-owned subsidiary of the company," the infrastructure major said in a statement.
"L&T Realty needs to perform independently. It has to continuously expand its project pipeline through proactive land bank growth and joint developments.
"This requires periodic capital infusion, and therefore, it is essential to bring all our real estate operations under a singular corporate structure and bolster L&T Realty's position as a unified brand for real estate," company's Chairman & Managing Director S N Subrahmanyan said.
L&T established its Realty BU in 2007 to convert owned land parcels into residential and commercial developments. In 2011, the company founded L&T Realty as a wholly-owned subsidiary to develop both L&T land holdings and joint-venture opportunities with leading partners.
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