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Warbug Pincus to invest Rs 1800 crore in Piramal Realty

Economic Times:  July, 2015

Mumbal: Global private equity major Warburg Pincus will be investing Rs 1,800 crore in Piramal Realty for a minority stake at entity level. The capital raised through equity transaction will be used for expansion of Piramal Realty's portfolio and acquire land parcels in and around Mumbai, said a top executive of Piramal Group.

The deal will be one of the largest foreign direct investments in Indian real estate sector.

Founded in 2011, Mumbai-based Piramal Realty currently has over 10 million sq ft of projects under development in various Mumbai and surrounding localities including Byculla, Worli, Bandra-Kurla Complex, Mulund and Thane.

"It's an exciting time to build a company. We want to build India's most admired real estate company, admired not just for its scale and profitability, but also for its impact of the lives of its customers and the entire economy," Anand Piramal, Piramal Group's Executive Director, told ET. "Enough of this capital will be used for new land parcels. Today, you know real estate market is distressed, we'll use this as an opportunity to buy a couple of land parcels."

As part of the transaction, New York head-quartered Warburg Pincus will get two seats in Piramal Realty's board, which will be reconstituted soon.

"Warburg Pincus invests in companies with high growth potential and believes that Piramal Realty is best positioned to achieve leadership in one of the world's most attractive real estate markets," said Niten Malhan, co-head India, Warburg Pincus.

This is the second time Piramal Group is partnering with Warburg Pincus after the private equity giant's investment in Piramal Healthcare in 1997.

Warburg Pincus' past and current investments in India include Bharti Airtel, Ambuja Cements, HDFC, Capital First, Kotak Mahindra Bank and Metropolis Healthcare.