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Investor Siva Scripting Mega Exit From Aamby Valley

04 February, 2010

The mystique of C Sivasankaran, the enter-exit king, continues. The maverick investor and Chairman of Siva Group is possibly making another blockbuster exit from India’s pioneering lifestyle real estate venture Aamby Valley, a megalopolis located near Lonavala in Maharashtra, where he holds 49% stake currently.

Sivasankaran, through Siva Ventures Ltd, had picked up the stake pumping in around Rs 1,800 crore in 2007. Banking sources said, Siva, as he is known in close circles, was in exit mode and has the option of selling the stake back to Sahara Group, who are 51% shareholders and promoters of Aamby Valley. 

Siva Ventures picked up the stake through a mix of equity, preference shares and debentures. The PE firm invested around Rs 1,000 crore through a mix of equity shares and preference shares in March 2007. VCCircle also learns that another Rs 800 crore was invested through debentures, which are yet to be converted.

Siva’s anticipated exit price is not known but, one source familiar with his investment strategy, said, he was unlikely to cut a deal with anything less than 30% return in normal circumstances.

Another source pegged the exit price at over Rs 2,400 crore but this could not be confirmed independently. An email sent to a Siva Group spokesperson did not elicit any response at the time of publishing this article. Emails sent to Sahara Group were also not answered.

While Siva has scaled up his real estate play in recent times, his move to pick up stake in Aamby valley three years back was surprising, with some industry observers believing it was aimed at bailing out the diversified private conglomerate Sahara Parivar in distress. Around that time, the group had sold its Sahara Airlines to Jet Airways for Rs 1,450 crore and had to wrap up its non-banking financial business after Reserve Bank of India (RBI) cancelled its licence.

Incidentally, Sahara is taking its real estate assets for an initial public offering that could raise up to Rs 3,500 crore. But Aamby Valley is not part of Sahara Prime City, the real estate company, which is being readied for the IPO. The jet-setting Siva has swooped down with investments to back several Indian business leaders in their troubled times.

Siva Ventures also holds a 14.98% stake in Sahara One Media and Entertainment, the entertainment arm of the group.

The media discovered his investment in Aamby Valley only two years later in 2009, with Siva Group officials disclosing very little information except stating it was private equity play. The reasons behind the timing of the planned exit, and how the funds will deployed, is not known. Siva, who sold his first telecom firm Aircel toMalaysia’s Maxis Communications for $1.8 billion, is now back in the play with S Tel, a new telecom operator with licences in six circles, and in the midst of a roll-out.

The 53-year-old Sivasankaran, known for his networking prowess, came into limelight when he acquired Sterling Computers from the Amritraj family in the 80s. He made audacious moves through the 90s, which included bidding for mobile telecom licences in India, developing resorts and recapitalizing banks in Thailand and hogged headlines for buying rapper MC Hammer’s residence in California.

He has remained active on the deal front acquiring and exiting companies like RPG Cellular, Barista, Tamil Nadu Mercantile Bank and Best & Crompton. He also mopped up minority positions in several lerading Indian companies like Tata Teleservices, where he still holds a little over 6% stake. More recently, he acquired Norwegian shipping company JB Ugland and also took controlling stake in Finnish firm WinWind, makers of wind turbines.

The $3-billion Siva Group has business oprerations in shipping and logistics, wind energy, edication, agri-business, real estate, hospitality and media.


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Investor Siva Scripting Mega Exit From Aamby Valley

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