EWDPL to raise Rs 700 crore

Realty developer Entertainment World Development (EWDPL), which builds malls and townships in central India, is planning to raise Rs 700 crore ($175 million) from Singapore-based realty investor CapitaLand and global private equity fund Forum Partners, according to sources.

EWDPL was on the verge of signing agreements with the investors in the next couple of weeks, sources said. CapitaLand, one of Asia's largest property investors, operating real estate investment trusts (REITs) in Asia, is close to picking up 49 per cent in the retail real estate projects of EWDPL for $130 million. CapitaLand and EWDPL are planning to develop 50 malls jointly in the next three years, according to sources.

Forum Partners, which has over $2 billion of capital under management, was planning to invest $40 million at the enterprise level and might pick up 10 per cent in EWDPL, sources added. Madhusudan, the chief financial officer of the company, declined to comment on the company's fund-raising plans. 
 

STAKE HOLDERS
Investor	Value ($mn)	Level	Stake  (%)
Eredene Capital	20	SPV	8
ICICI Venture	12	Enterprise	14
Capital and	130	SPV	49
Forum Partners	40	Enterprise	10

According to company sources, EWDPL has lined up nearly $500 million for its projects within two years. The current exercise was the second round of fund-raising before the company went public in a year or so, said sources. The company is planning a domestic listing or an overseas public float on the Alternative Investment Market (AIM) to raise $175 -200 million, according to sources.

EWDPL has received nearly $35 million in funding from various venture capital funds. Private equity fund Eredene Capital has invested $20 million for an 8 per cent stake in one of the realty company's projects. ICICI Venture, through its real estate fund, has picked up a 14 per cent stake in the company for $12.2 million. EWDPL has also entered into a joint venture with Future group firm Kshitij to develop malls, where both have invested nearly $4 million each.

A company official said the company wanted to aggressively pursue the retail space with its flagship brand Treasure Island. "We are planning to build 100 small format malls in the range of 75,000 sq ft to 2 lakh sq feet and 25 large malls of 5 lakh sq ft across the country. For this, we need large funds. Hence we are going for a mix of debt, private equity and a public issue," he said.

The company has developed over 6 lakh sq ft till date and plans to develop nearly 13 million sq ft in the next three years. It is also planning to enter south and west India in the next couple of months.

CapitaLand, which has property investments in 90 cities of 20 countries, today announced that it would set up two dedicated retail development funds worth $1.2 billion. To be called CapitaRetail China Development Fund II and CapitaRetail India Development Fund, each will have a fund size of $600 million.