The luxury hospitality segment witnesses a new development with Brookfield Asset Management’s buyout of four Leela Venture properties
Hotel Leela Venture Ltd (HLVL) has announced that it will be selling off its four hotels located at Bangalore, Chennai, Delhi and Udaipur and the property that it owns in Agra with a right of first refusal over the company’s hotel in Mumbai, as a part of the transaction to Canadian investment fund Brookfield Asset Management for INR 3,950 crore. Simultaneously, the promoters who own the Leela brand would also be transferring the Leela brand to Brookfield for all hospitality businesses. The leading Indian luxury hospitality group entered into a binding agreement with a Brookfield Asset Management-sponsored private real estate fund to sell, by way of slump sale.
Sharing his view on the recently concluded deal, Vivek Nair, chairman and managing director of HLVL said “The Leela is rated amongst the top hospitality brands in the world and I am confident that the brand will receive a boost and be further strengthened and continue to be known for its world-class services.”
The most significant hotel deal includes assignment of all hotel management contracts currently in operation as well as all management contracts for hotels which are currently under development, along with the employees of the hotels. The total business deal value is INR 3950 crore plus the applicable transaction costs, which is subject to approval of shareholders, lenders and other regulatory and statutory approvals.
Taking about the significant takeover, Ankur Gupta, managing director and head-India real estate, Brookfield Asset Management remarked “The Leela is one of the finest hospitality groups in India and over the years it has gained extraordinary recognition from some of the most prestigious authorities on travel and luxury in the world. We are excited with this opportunity and look forward to completing this transaction at the earliest, while ensuring that all operations remain unaffected. We expect the Leela hotels to continue to be market leaders.”
Post sale of properties, Hotel Leela Venture will continue to run its hotel in Mumbai and own certain pieces of land in Hyderabad as well as a joint development project of residential apartments with Bengaluru-based Prestige Developers.