Realty developer Oberoi Realty has sold 21.74% stake in its joint venture company I-Ven Realty to global investment firm Alpha Wave Ventures II for Rs 1,250 crore, making it one of the largest private equity investments in India’s real estate sector so far this year.
As per the agreement between the developer, promoter Vikas Oberoi, I-Ven Realty, and Alpha Wave Ventures II, the company has allotted a combination of 277,778 Series A convertible preference shares (CCPS) and 10 Class A equity shares, the listed company said in a regulatory filing.
Separately, the company announced Vikas Oberoi has pledged nearly 24.62 crore shares of Oberoi Realty amounting to over 75% of his nearly 68% stake in the company.
I-Ven Realty, which has been focused on real estate development, has no recorded revenue in the last three financial years but is expected to ramp up operations following this capital infusion.
The deal highlights the growing interest of global investors in India’s real estate sector, particularly in Mumbai’s high-value commercial and residential projects.
In March, Oberoi Realty had announced, I-Ven will be undertaking a rights issue of redeemable preference shares at an issue price of Rs 400 each to the company and Vikas Oberoi in equal proportion, raising Rs 165 crore. The proceeds from the rights issue will be used for repayment of loans and redeeming existing preference shares held by Oberoi Realty and Vikas Oberoi.
The agreement in March had outlined governance rights for Alpha Wave Ventures, including the ability to nominate a board director and have veto powers on key operational and managerial matters.
Additionally, there will be a five-year lock-in period during which none of the stakeholders can sell their shares. Post-lock-in, Alpha Wave Ventures has multiple exit options, including a sale to a third party or a merger with Oberoi Realty.
In the regulatory filing then, Oberoi Realty had said the transaction will not affect its management or control, with Vikas Oberoi continuing to hold at least 51% stake in the company.
Source: Economic Times