Delta Corp Buys 51% Stake in Thunderbird’s Daman Hospitality

By Pallavi S

  • 16 May 2011

ICICI Ventures-backed Delta Corp has acquired 51 per cent stake in Daman Hospitality Pvt Ltd for Rs 50 crore in its second acquisition this year. Daman Hospitality is in the process of building a five star deluxe resort in Daman and Delta Corp will pitch in with Rs 40 crore more as debt for the project.

Daman Hospitality is the Indian affiliate of NYSE Euronext Amsterdam-listed Thunderbird Resorts. Thunderbird will continue to own the balance 49 per cent in the company, along with original Indian partners, while Delta will be responsible for securing any new debt for the project. Thunderbird is into branded casino and hospitality services and focuses on markets in Asia and Latin America, with operations in Costa Rica, Nicaragua, Peru and the Philippines. It will now run the upcoming Daman hotel with a management contract.

As a part of the deal, Delta will subscribe to 840,000 shares of Thunderbird at a price of $2 per share or around $1.68 million. This deal is to be completed by May 31.


Daman Hospitality resort is expected to feature 176 rooms, besides a vast spread of indoor and outdoor entertainment area and a shopping arcade. The project is substantially completed and is expected to be ready in another 6-8 months. Delta plans to operate a casino in the upcoming project as part of its business model of combining hospitality and gaming.

This happens to be the second deal in four months. In February this year, Delta said that it was acquiring a majority stake in Marvel Resorts Pvt Ltd for up to Rs 54 crore ($12 million) to strengthen its position in the offshore and onshore casino space in Goa, one of the top Indian tourist destinations.

The deal may involve stake purchase of anywhere between 67-100 per cent and the transaction value will accordingly range between Rs 36 crore and Rs 54 crore. As part of the transaction, Delta will also assume the debt lying in Marvel.


Marvel owns approximately two acres in the capital city of Panjim, Goa, and has approved plans for a five star hotel to be built on the same land parcel. With the acquisition, Delta proposes to develop a land-based casino in the five star hotel. Delta Corp is acquiring the stake through its subsidiary Delta Hospitality and Leisure Pvt Ltd.

Moreover, the company has recently acquired MV Horseshoe Casino from Harrah’s Corp Inc., which runs Caesar’s Palace in Las Vegas, and the move will boost its offshore casino business. It will treble Delta’s 725 existing gaming positions to 2,225 by end of June when it is expected to arrive in India.

Delta Corp had raised Rs 285.48 crore last year through a mix of shares and equity convertible warrants issue to a group of largely individual investors, including ace investor Rakesh Jhunjhunwala and his wife.


Although it was originally a textile firm, the company had undergone a business restructuring over the last two years and became a hospitality and real estate player by demerging its textile business to Arrow Textiles.

The largest shareholder of Delta Corp is Zia Jaydev Mody (one of the top corporate lawyers of the country and daughter of Soli Sorabjee) who is married to Jaydev Mody who in turn is related to the Piramals and has been engaged in the real estate sector.

ICICI Venture bought 14.99 per cent in Delta (then Arrow Webtex) for Rs 82 crore at a price of Rs 40.5 per share. Since then, its holding has whittled down to just over 7 per cent due to subsequent issues and some share sale in open market transactions. Another investors in the company is BCCL (through Brand Equity Treaties Ltd).


Delta Corp owns two offshore Casinos in Goa – Casino Royale and King’s Casino. It also owns a large minority stake in Advani Hotels & Resorts which, in turn, owns Ramada Caravela Beach Resort and also operates offshore Casino Goa on board MV Caravela.

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