Deutsche Bank exits Lodha Developers with over Rs900 crore gain

Deutsche Bank has exited construction group Lodha Developers with a gain of 902 crore on its Rs1,640 crore investment made in 2007-2008.

Deutsche Bank has been paid a total of Rs2,542 crore on its investment of Rs1,640 crore made in late 2007, one of the largest and most profitable investments for any FDI in Indian real estate.

For Lodha Developers, the investment has helped it complete the project at a time when the financial markets were tight, the company said in a release. 

''The completion of the milestone is a significant achievement for our organisation. Our ability to generate positive cash flows from our business by focusing on execution and end user sales has enabled us to make such a large payment at a time when the general economic environment is quite tough. The capital from Deutsche Bank in 2007 has played an important role in our company's growth and we appreciate our relationship with Deutsche Bank'', Abhinandan Lodha, deputy managing director of the company, said.

The exit was financed by Rs1,720 crore from internal accruals and Rs825 crore raised through fresh borrowing.

Mumbai-based investment bank Trustcap acted as the sole advisor to the transaction. Prior to this, Lodha had repaid loans to JP Morgan and HDFC Venture Fund for their investments in its other projects.

Lodha is now left with investments from HDFC Venture Fund, ICICI Ventures and Old Lane in its other projects.

Lodha Group is currently developing over 30 million sq ft of prime real estate over 38 projects in and around Mumbai, from Napean Sea Road in Mumbai to Palava in suburban Kalyan-Dombivli.