Mumbai-based Indiabulls Real Estate and Bengaluru-based developer Embassy Property Developments are expected to meet on August 18 to finalise the valuation and swap ratio for their proposed merger, sources told Moneycontrol.
According to the plan, Embassy Group’s real estate assets are to be amalgamated with Indiabulls Real Estate’s 31 million sq ft of assets that are currently under development.
Embassy Group is merging real estate assets spread over 61.9 million sq ft with IBREL.
After the merger, Embassy Group and its chairman Jitu Virwani will be the new promoters of the combined company. Indiabulls Group will finally exit its real estate business and its current promoter Sameer Gehlaut will become a passive shareholder.
In June last year, the promoters of IBREL sold 14 per cent stake through open market transactions to Embassy Group for Rs 950 crore, as part of their strategy to focus on financial services and exit from realty business.
IBREL had in January this year announced its proposal of the merger of certain ongoing, completed and planned residential and commercial projects of Embassy Property Developments with itself.
In a regulatory filing in July this year, IBREL had said it had received the proposal from Embassy detailing their various assets for the merger of Embassy with itself.
"To give effect to the amalgamation, the board-constituted committee of the company is taking required steps including the appointment of merchant bankers, lawyers and valuers to arrive at the swap ratio and definitive agreements, to be placed before the Board for their approval in four weeks from today," the filing had said.
Blackstone Group Lp is a key investor in many of Embassy’s projects. The two operate the country’s first real estate investment trust or Embassy REIT.
More details are expected soon.
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