Piramals ‘Frontrunners’ for HUL Worli Property; Deal Likely to be Signed After Rs 400 Crore Bid

Piramal, HUL

Piramal Realty has emerged as the highest bidder for a sea-facing property owned by soaps-to -foods maker Hindustan Unilever in Mumbai, beating businessmen Anil Ambani and Gautam Adani in the race. More than one person with direct knowledge of the development said, Piramal bid over Rs 400 crore for Gulita , which currently houses a training centre and private residences of its senior executives. In an emailed response, an HUL spokesperson said: “We are still in the process of evaluating various options to create value from our Gulita property.”
Piramal Realty, which is the real estate arm of the Ajay Piramal group, said: “We do not comment on market speculation.” Unlike Ambani and Adani, who had bid in their personal capacity and not through their group firms, Piramal bid through the real estate company, with plans to develop residential apartments on the one-acre plot. One source said Piramal Realty is likely to develop a super-luxury residential project and group head Ajay Piramal may retain a duplex on the top floor for his personal use.
The transaction is likely to be concluded in the next few months with the entire consideration paid in two tranches. According to realty market experts, after redevelopment the plot has potential to build up to 100,000 sq ft of saleable space following the recent amendments to the Development Control Regulations, and introduction of fungible floor space index. Floor space index is permissible development on a given land parcel. Current rates for luxury apartments in the area are over Rs 60,000 per sq ft. Last year, Piramal Realty also acquired the right to develop a 7.6-acre leasehold land parcel at Byculla in central Mumbai from Mafatlal Industries for over Rs 600 crore. The listed Indian subsidiary of the Anglo-Dutch FMCG firm holds a perpetual lease from BMC.
HUL originally planned to carry out an outright sale, but after BMC raised the premium on ownership transfer from 7.5% to 50%, HUL decided to sub-lease the property on concerns of higher cash outflow. The company changed its plan once again, when the Supreme Court set aside BMC’s new transfer charge policy. At least ten companies or persons had evinced interest in buying the property. Piramal Realty and HUL have also decided to share the 7.5% premium to be paid to the Brihanmumbai Municipal Corporation for transfer of ownership of properties leased by the civic authority. On Friday, shares of Hindustan Unilever closed at Rs 382.05 on the National Stock Exchange, down 0.6% from Wednesday’s close.
Source- ET


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