Unitech makes way for Unitech Office Trust (UOT)

Unitech Corporate Parks Plc, a real estate investment firm listed
on AIM market of London Stock Exchange, has proposed to sell stake in
three of its development projects for 234.1 million pounds (Rs 1,830
crore).

Unitech’s InfoSpace projects in Gurgaon, Noida and Kolkata would make
way for wholly-owned subsidiaries of Unitech Office Trust (UOT). However
company intends to seek the approval of shareholders for the conditional
sale of its interests in three out of its six development projects in
India. The proposed sale would be conditional upon the successful completion
of the UOT’s offering and the listing of the units on the Singapore
Stock Exchange. If the transaction is not completed, the company intends
to continue to develop the projects itself.

UOT is a Singapore-based business trust established with the principal
objective of investing in real estate in India to raise the consideration
for the acquisition by way of an international placement to investors
and an offering to the public in Singapore. UOT is also a wholly-owned
indirect subsidiary of India’s second largest real estate firm Unitech
Ltd.

Unitech Corporate Parks Plc chairman Atul Kapur said "We intend
to reinvest the proceeds of the disposal into early stage Indian real
estate development projects and are seeking approval to widen Unitech
Corporate’s investment strategy to include the hospitality, retail and
other commercial and mixed-use sectors. As we are of the firm belief,
that in addition to our focus on the real estate requirements of the
high growth Indian IT and IT Enabled Services sectors, these are areas
where we can also create significant shareholder value."

Investment strategy of Unitech Corporate Parks aims to cover 92.4 acres
and provide an area of 10 million square feet of commercial property
for the IT and IT Enabled Service Sectors with the completion of its
projects. The minimum consideration payable to Unitech Corporate Parks
for these assets would represent an average project level Internal Rate
of Return (IRR) of 38.9 per cent, assuming completion on March 1, 2008.

Photo: Indian Delights on Wellington Street, Hull – geograph.org.uk – 4652481 by Ian S, licensed under CC BY-SA 2.0, via Wikimedia Commons.