Private equity giant Blackstone has agreed to acquire a technology park in Bengaluru from Coffee Day Enterprises Ltd, the operator of coffee retail chain Café Coffee Day.
Coffee Day said in a stock-exchange filing on Wednesday that its board has approved the sale of Global Village Tech Park of unit Tanglin Developments Ltd for an amount between Rs 2,600 crore and Rs 3,000 crore ($365-421 million).
The deal closure is subject to completion of Blackstone's due diligence, documentation and receipt of requisite regulatory approvals. The process is likely to take 30 to 45 days.
The current transaction will help Coffee Day cut down its debt and ensure smooth operations while safeguarding the interests of all stakeholders, including investors, lenders, employees and customers, the filing said.
The development comes after Café Coffee Day founder VG Siddhartha committed suicide allegedly under pressure of debt. A letter, purportedly written by Siddhartha, had mentioned an unnamed private equity partner as pressuring him into a share buyback, and “harassment” from tax authorities, among others.
The office park had been on the block for some time now. Coffee Day had made attempts to sell the asset to cut debt a few quarters ago. A bunch of global investors had looked at the property in the past for a potential deal.
The tech park is spread over 120 acres in Bengaluru with a built-up area of 3.3 million square feet (sq ft). The park has an additional potential of roughly five million sq ft built-up space. It counts among its tenants companies such as Mindtree, Mphasis and Accenture.
Blackstone, which has one of the biggest portfolios of commercial real estate in the country, has been actively buying out office buildings in the country.
As reported by VCCircle, it recently acquired an office building in Powai, Mumbai from L&T Realty, an arm of business conglomerate Larsen & Toubro (L&T) for Rs 700 crore.
Prior to that, the PE firm bought One BKC for Rs 2,500 crore, a commercial real estate project of Sanjay Chhabaria's Radius Group that is located in Mumbai's Bandra Kurla Complex business district.
Blackstone Real Estate has so far put $5.4 billion in Indian real estate across office buildings and retail assets. It has done 33 transactions across the country and owns over 100 million sq ft in India.