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Leading real estate company Embassy Property Development plans to sell off several assets including its office park in Chennai that spans 5 million square feet, N2 within Embassy Manyata Business Park that covers 1.6 million square feet and additional office spaces totalling 1 million square feet, in a bid to reduce its debt of $8,800 crores. The business also intends to lower its debt by selling completed goods supported by the required occupancy certificate (OC) from its residential projects.
Embassy generated around 1,300 crores in revenue last year through the sale of inventory in its luxury and premium residential developments which contributed to the reduction of its debt. The first step in getting there is to cut the debt by $2,700 crore before September 30, 2023. The business also claimed to have valuable assets including a 73% stake in Wework India which it plans to eventually monetize.
Embassy Group lowered its debt by Rs. 1,400 crores by selling commercial assets and a portion of its investment in Embassy REIT earlier this year. The deal was made with Embassy REIT, resulting in a 334.8 crore enterprise value overall. A further 1,250 crore was generated by the company by selling 4% of its holding in Embassy Office Parks REIT to Bain Capital.
The largest shareholder in Indiabulls Real Estate, Embassy Group intends to file an appeal with the National Company Law Appellate Tribunal in response to the most recent decision rendered by the National Company Law Tribunal's Chandigarh bench. The judgement put a stop to NAM Estates and Embassy One Commercial Property Developments' plan to merge with Indiabulls Real Estate (IBREL). They have 45 days to file an NCLAT application to challenge the NCLT order and they believe that they have a solid legal foundation to do so.
Indiabulls Real Estate is subject to the jurisdiction of the NCLT's Chandigarh bench, which earlier this month expressed special concerns based on the objections made against the merger by the income tax department. The valuation used to determine the swap ratio for the merger was completed by two independent, reputable, and acknowledged valuers and supported by a fairness judgement provided by a Sebi-registered Category I merchant banker. Other regulators like SEBI, BSE and NSE examined the valuation reports and determined them to be adequate.
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