Atalanta, the infrastructure and real estate company based in this city, is looking for a partner ready to buy a 26 per cent stake in a mega entertainment township project it is developing at Suvali near Surat in Gujarat. The cost of the project, run under a special purpose vehicle, Atlanta Tourism Ventures, is Rs 9,500 crore.
Rajhoo Bbarot, managing director, said they were looking for a good brand, preferably an international group, to take a stake in the project. "We are looking at high standards for our theme parks like Sentosa or Disneyland. If an experienced brand takes equity in the project, they can bring in expertise as well," he said.
The township will have five theme parks -- water park, amusement park, ice skating, nature park and ski dome. There will be hotels, restaurants, a movie theatre and residential projects such as villas and studio apartments to house 40,000 people.
Atlanta is planning to start talks after signing a concession agreement with the state government of Gujarat for the project in the next two to three months. A memorandum of understanding was signed at the ‘Vibrant Gujarat’ conference between the state government and investors this year.
It will require debt of Rs 3,000 crore, while the promoters would infuse Rs 1,000 crore in equity. The equity portion will include a possible partner's contribution. "That stake sale, however, will be at a premium because it will have approvals and clearances," said Bbarot.
The promoters are to arrange for their share of the equity via internal accruals and securitisation of some of their road projects which are operational, such as the Mumbra bypass. “We will securitise revenues from the project for the next 10-15 years and invest that in the tourism project,” said Bbarot. The rest of the amount would be financed by various methods such as deposits from restaurants, spas and others who may wish to set shop in the township.
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The company is also hoping to get deposit money from non-resident Indians. It is to offer six per cent interest on deposits from individuals and the principal would be returned after 20 years. "Meanwhile, the depositor can stay at the resort and park for 21 days every year," said Bbarot.
The land required, 1,300 hectares, is already with the state government. It is to be transferred to the company after the signing formalities. This would be on a lease of 36 years, extendable. "We will work on environment approvals and financial closure after we sign the concession agreement, and expect to start construction in 2012," said Bbarot.
The park would take three years to build.