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DLF plans to raise $400 mn via PE route

India's largest real estate firm DLF is now all set to raise another $400 million through private equity route to fund its long-term investment plans. As per the deal, financial services major Merrill Lynch will get 20 per cent assured return and the debt will later get converted into equity. Merrill Lynch could pick up 49 per cent in 3-5 townships. The decision on the deal will be taken in mid-January after DLF’s real estate investment trust (REIT) listing is complete. Though the management continues to remain very tight lipped about the deal they are not denying it either. “DLF has a large number of residential, integrated townships and commercial projects in the pipeline. While the company is looking to list its commercial properties in a REIT these PE deals in residential projects are not only about raising funds,” said Ramesh Sanka, CFO, DLF. [...]

VSNL sells 10% in Lankan arm

VSNL has sold a 10 per cent stake in VSNL Lanka Ltd, its wholly owned subsidiary in Sri Lanka. The Tata group company has sold the stake to Sunshine Holdings, a Sri Lankan conglomerate, for about Rs 2.72 crore. Sunshine Holdings has interests in pharmaceuticals, travel & tourism, tea and rubber cultivation. It also manages portfolio investments. The Sri Lankan firm has bought 5.17 lakh shares, which accounts for 10 per cent of the paid-up capital of VSNL Lanka. It has an option to acquire an additional 5 per cent of VSNL Lanka’s share capital in the next 12 months at fair market value. “The partnership with Sunshine Holdings will enable VSNL Lanka to capitalise on the partner's knowledge of the Sri Lankan market. This is also our attempt to unlock value for our shareholders in an appropriate manner,” said Rajiv Dhar, CFO of VSNL. [...]

PE investors may acquire 15% in Nahar Retail for Rs 120 cr

Citibank, Deutsche Bank and Sequoia Capital are learnt to be negotiating with Ludhiana-based Nahar Industrial Enterprises (NIEL) to pick up 15-20% in its wholly-owned arm Nahar Retail for Rs 120 crore. Nahar Retail owns Cotton County retail chain, which has 400 stores all over. A deal with one of these three PE players is likely to be closed in a month’s time, a source said, adding that the company will go in for an IPO in 2009. The exact stake to be sold will depend on the company’s valuation, but it should be in the 15-20% region, he said. Nahar Retail, which started the Cotton County apparel retail chain three years ago, today has 400 stores in 300 cities. It plans to take it to 500 by this fiscal-end at an investment of Rs 30 crore. Nahar Retail, which clocked a revenue of about Rs 100 crore last fiscal, is targeting a figure of Rs 250 crore this fiscal. Meanwhile, NIEL, which is an integrated textile company present across the value chain from yarn to fabric and garments, has seen its share price move up rapidly, of late. [...]