 "Unitech, UCP get BoA approval for stake sale in 5 SEZs")
UCP and realty major Unitech are jointly developing five special economic zones (SEZs) and one IT Park in Gurgaon, Noida and Kolkata. In these six projects, UCP holds 60% stake and Unitech 40%.
In June, UCP had announced that it has signed a deal to sell its 60% stake in the six projects to Brookfield for about 205.9 million pounds (Rs 2,050 crore).
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Separately, Unitech also sold its 40% stakes in 4 projects.
In its meeting held on September 18, the Board of Approval (BoA), a 19-member inter-ministerial body headed by Commerce Secretary, has approved the Unitech-UCP proposal for change in the shareholding patterns in these five SEZs.
The BoA approvals are subject to certain conditions. It has directed that full financial details relating to change in equity/merger, demerger, amalgamation or transfer in ownership etc should be furnished immediately to Member (IT), CBDT, Revenue Department and to the jurisdictional authority.
All eligibility criteria applicable to developers, including security clearances etc, should be fulfilled by the new developer entity and its constituents, according to the minutes of the meeting.
Sources said that the BoA clearance was necessary condition for closure of the deal, which is now expected to get completed soon.
Unitech would get about Rs 1,500-2,000 crore from selling its 40% stake in four SEZs projects and also about 10% direct stake in UCP. The proceeds would be utilised to reduce debt, they added.
The company's net debt stood at Rs 5,900 crore at the end of the first quarter of this fiscal. The company currently has over 100 ongoing projects, totalling an area of 38.41 million sq ft.
Unitech Chairman Ramesh Chandra has told shareholders in the annual report that the company would sell non-core land to reduce debt by 15-20% and improve cash-flows for faster execution of ongoing projects.