Hotel Leela to sell 4 hotels to Brookfieldhttps://indianexpress.com/article/business/companies/hotel-leela-to-sell-4-hotels-to-brookfield-5633017/

Hotel Leela to sell 4 hotels to Brookfield

The sale proceeds will go to the lenders towards debt repayment as part of the restructuring plan.

Hotel Leela, Hotel Leela group, Hotel Leela Brookfield deal, Brookfield, Indian express
Hotel Leela will continue to operate the hotel in Mumbai and own certain land in Hyderabad

Hotel Leela Venture Ltd will sell four of its hotels and a property to Canada’s Brookfield Asset Management for Rs 3,950 crore as part of a debt restructuring plan.

The company, originally promoted by Captain Krishnan Nair, has proposed to sell the hotel business, together with all assets and liabilities of the hotels located in Bangalore, Chennai, Delhi and Udaipur on a slump sale basis as a going concern, including the company’s rights in the hotels, and underlying immovable properties, it said in a stock exchange filing.

The sale proceeds will go to the lenders towards debt repayment as part of the restructuring plan. However, Hotel Leela will continue to operate the hotel in Mumbai and own certain land in Hyderabad and the joint development project of residential apartments with Prestige Developers in Bangalore. Brookfield will have a right of first refusal over the company’s hotel in Mumbai as part of the transaction.

The sale will also include 100 per cent shareholding of the company in Leela Palaces and Resorts Limited which owns property and holds licenses for the development of a hotel in Agra, the filing said. This will also include all the intellectual property, if any, owned by the promoters and their affiliates.

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“The sale plan also includes execution of a license agreement and centralised services agreement with the company in connection with The Leela’ hotel in Mumbai and leasehold rights with respect to the land forming part of the larger land admeasuring 24,404 square metres situated at Old Airport Road, Bangalore, by way of a fresh lease from Leela Lace Holdings Pvt Ltd and cancellation of the existing lease with the company, the exchange filing said.

The consideration of Rs 3,950 crore will be paid to the lenders of the company as per the terms of the definitive agreements towards repayment of dues owed by the company to its lenders, and after completion of the transaction, all borrowings of the company from all banks and financial institutions would stand repaid.