Luxury hospitality player Hotel Leelaventure Ltd has invited Expression of Interest for sale of its hotel properties in Chennai and Goa to bring down huge pile of debt on its books, according to a stock market disclosure.
The luxury hotel chain has also engaged JM Financial Institutional Securities for the sale of the properties.
"In accordance with the powers delegated by the company's board, the Assets Sale Committee, in its meeting held on March 2 has decided to commence the process for sale of its hotels in Goa and Chennai," the company said.
Hotel Leelaventure has an outstanding debt of around Rs 5,000 crore, of which around Rs 4,000 crore is with a State Bank of India-led consortium of banks.
The Leela Goa, built in 1991, is spread across 50 acres at Cavelossim on the Mobor beach with 206 guest rooms and suites. It is said to be one of the best performing hotels for Leela.
On the other side, Leela Chennai was opened in September 2012. The hotel has 326 guest rooms and is built on 4.8 acres owned by the company.
In the quarter ended on December 31, 2014, the public-listed hospitality firm posted a net loss of Rs 125 crore as against a net loss of about Rs 100 crore in the same period the previous year. The loss widened due to lower other income and higher finance costs, which stood at 133 crore.
Previously as well, the company had made several unsuccessful attempts to raise fund by selling its properties, including an agreement with a private equity giant Kohlberg Kravis Roberts (KKR) for a bridge loan.
The company has been selling assets to generate liquidity and reduce its debt. Earlier, Leela sold its IT park in Chennai for Rs 170 crore to Reliance Industries and its property in Kovalam to Ravi Pillai for Rs 500 crore.
(Edited by Joby Puthuparampil Johnson)