Kotak fund to buy 10% stake in Sunteck

MUMBAI: Kotak Reality Fund, a fund managed by Kotak Mahindra Investments, will invest Rs 140 crore in Sunteck Realty to acquire a 10% stake in the latter. This would be one of the first investments from the new $400-million realty fund recently raised from domestic investors by Kotak Mahindra Investments.

The investment would be through a combination of equity and convertible preference shares, which on conversion will result in a 10% stake in the company, on a fully-diluted basis, Sunteck said.

Sunteck Realty is currently listed on the Bombay Stock Exchange. The group plans to utilise the funds towards developing residential and commercial projects in Mumbai, Goa, Pune, Nagpur, Chennai and other key Tier-II cities.

The group is currently developing a premium residential project in Mumbai at Bandra-Kurla complex branded as Signature Island, apart from other office/IT park projects in the metropolis.

Group’s chairman Kamal Khetan said: “This investment will complement our existing expansion plans. We intend to add other value-accretive properties to our existing list of acquisitions, especially in Mumbai.”