DLF Promotor Stake Dilution

Promoters of realty major DLF plan to sell 16.8 crore shares — about 9.9% of the equity — via a market sale, raising nearly Rs 3,800 crore, sources said. The stake sale may take place via overnight bookbuilding issue and Deutsche Bank is the appointed book runner along with JPMorgan, sources added. Private investment companies controlled by Rajiv Singh and family will sell the stake, which would be executed within the next two trading sessions.
Promoters of realty major DLF are looking to offload their stake in the company and are looking to raise USD 400-700 million from the stake sale, reports CNBC-TV18 quoting sources. Proceeds from the stake sale will be ploughed into DLF Assets Limited (DAL), sources said. DLF honcho Kushal Pal Singh, along with his family, holds nearly 89% in DLF. The proceeds into DAL could be used to buy DE Shaw’s stake in DAL — which had earlier invested USD 450 million in the company and wants to exit — or pay off DAL’s dues to DLF, sources further added. DAL’s outstanding dues to DLF stand at Rs 4,930 crore.
Deutsche Bank has been appointed banker for the promoter stake sale. The deal, which was supposed to close today, however has not closed yet. DLF promoters and management, it is learnt, have not directly spoken to investors about the stake sale.
When contacted, DLF said it did not comment on market speculation. Analysts are of the view that the stake sale is a good move as it does not dilute shareholders’ stake.