Vijay Khetan Group plans to raise Rs 1,500 crore from private equity funds and institutional investors, which would be used mainly to buy distressed land assets.
The real estate company intends to pool the investments in a special purpose vehicle (SPV) that would be set up with an equity partnership with the investors.
“We are in talks with a number of investors, predominantly Indian and offshore private equity and sovereign funds. We intend to complete the fund-raising before the end of this financial year,” said Anuj Khetan, Director, Vijay Khetan Group, confirming the development.
He, however, declined to name the PE funds and institutional investors the group was in talks with, citing non-disclosure agreements.
The group, which has an asset bank comprising land and properties worth about ?2,500 crore in Mumbai, is close to appointing an investment banker. It has already appointed Nishith Desai Associates as legal advisors.
The Mumbai-based group, a specialist in acquisition of distressed land assets, had bought assets of Borosil Company in 2002 and Scientific Instruments in 2004. Later in 2006, it acquired land assets of Bharat Coaltar, Pure Drink (2007), Shakti Mills (2007) and Calico Mills (2008). “There is a pipeline of distressed assets that we intend to acquire through the new SPV. We also intend to use the funds to acquire land banks and for capital expenditure,” he added.
The realty firm’s ongoing projects include development of a 200-key luxury hotel, a 2.5 million sq.ft commercial and residential property and a five million sq.ft redevelopment project in Mumbai. The company is also developing a 250-acre smart city project at Igatpuri in Nashik district, which is expected to be ready by the latter half of 2016.