GIC to invest Rs1,511cr in three subsidiaries of Phoenix Mills to form a retail-led mixed-use platform

GIC will initially acquire an equity stake of ~26.4% in the PML Subsidiaries.

Jun 02, 2021 03:06 IST India Infoline News Service

Phoenix Mill
The Phoenix Mills Limited (PML) on Wednesday executed definitive documents with GIC, Singapore’ssovereign wealth fund, to form a strategic investment platform, to develop, own and operate retail‐led, mixed‐use developments in India.

PML through its subsidiaries, Offbeat Developers Private Limited (ODPL), Graceworks Realty & Leisure Private Limited (GRLPL) and Vamona Developers Private Limited (VDPL) and GIC will be parties to the transaction (hereinafter, ODPL, GRLPL and VDPL together referred to as “PML Subsidiaries”). PML will contribute the following retail and commercial assets to the platform. 

Earlier, in December last year, PML had announced the signing of a non‐binding term sheet with GIC for the formation of this retail‐led, mixed‐use platform.

As per the regulatory filing, GIC will initially acquire an equity stake of ~26.4% in the PML Subsidiaries by investing an aggregate amount of approximately Rs. 11,110 million by way of a combination of primary infusion and secondary purchase of equity shares in the said PML Subsidiaries.  The platform is valued at a pre‐money enterprise value of Rs. 55,000 million. GIC’s stake may further increase to ~33%‐36% in the above‐mentioned subsidiariesthrough an additional infusion of up to Rs. 4,000 million within 12‐month period from closing. 

PML said that the primary proceeds from the transaction are intended to be utilized by the PML Subsidiaries as growth capital for further expansion and acquisition of greenfield, brownfield, operational and/or distressed mall opportunities.  The secondary proceeds will bolster PML’ssafety net in the near term, fund various under‐ construction projects and act as war chest for further acquisitions in the medium term. GIC and PML may consider various options to monetize this platform, including by way of a REIT, over a three to five‐year period from the closing of this transaction.  

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