Sun Apollo, Rustomjee Builders reach out of court settlement
Nov 21, 2013
Source : The Economic Times

 

MUMBAI: Sun-Apollo India Real Estate Fund and Rustomjee Builders, locked in a court battle over a financial dispute, have reached an out-of-court settlement under which the private equity player exited in the realty firm for an undisclosed sum.

"An entity controlled by the promoters of Keystone (Rustomjee's parent company) has purchased all the securities of Keystone held by Mausmi SA Investments and Mausmi Ventures (both investment vehicles used by Sun-Apollo)," a statement from Rustomjee issued late this evening said.

Consequently, the private equity fund's nominee directors on Keystone, Prakash Kalothia and Sorabh Jain, have also stepped down, the statement added.

Sun Apollo had invested Rs 235 crore in Keystone in May 2009 through Mausmi SA Investments and Mausmi Ventures.

Relations between the fund and its investee company soured in 2011, with Sun Apollo accusing Rustomjee of misutilisation funds and not disclosing adequate information.

The Rustomjee statement announcing the truce was, however, silent on the amount at which the private equity fund exited its investment.

"Mausmi SA Investments and Mausmi Ventures, affiliates of private equity firm Sun-Apollo, and Mumbai based realty developer Keystone Realtors, flagship company of the Rustomjee Group, have resolved all their differences," it said, adding that both the partners have mutually agreed to the terms.

After the relations turned sour, Sun-Apollo approached the Company Law Board to resolve the issue through arbitration. As it failed in getting relief, it approached Bombay High Court and later the Supreme Court.

Keystone's Chairman Boman Irani, said, "I am pleased to announce that given the tough macro-economic environment, this is a significant exit for a real estate fund in a 4-year time frame."

A spokesperson for Mausmi SA Investments also confirmed the pact, saying: "We are happy to have reached a cordial settlement with Keystone."

 

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