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Rediff News  All News  » Business » DLF to buy ultra-luxury Amanresorts for $250 mn

DLF to buy ultra-luxury Amanresorts for $250 mn

November 14, 2007 01:23 IST

DLF Ltd is acquiring the privately-held super luxury resorts and spa chain Singapore-based Amanresorts for around $250 million.

This will be the first overseas acquisition by India's largest real estate company, which recently went public.

Sources close to developments said at $250 million, the deal is being concluded at an extremely conservative valuation.

In addition to this payout, DLF will assume debt of approximately $220 million as part of the deal.

DLF, the country's largest realty firm by market capitalisation at over Rs 1,48,527 crore, had announced a month ago that it intends to raise $750 million overseas for acquiring and developing properties abroad.

Part of the proceeds would be used for funding the Amanresorts acquisition.

The $220 million debt will remain on the Amanresorts balance sheet and be paid off from its future revenues.

The 20-year-old Amanresorts has 18 operational properties under its belt in Indonesia, Cambodia, Sri Lanka, Morocco, Bhutan, India, the Philippines, the United States, French Polynesia and France.

All Amanresort properties have a room tariff of over $600 per night, giving it a hugely exclusive tag. Since very few of these properties have more than 50 or 60 rooms and villas, the chain functions on the lines of a lifestyle resort for the rich and famous.

Singapore-based Silverlink Holdings holds a majority stake in Amanresorts and will completely exit the company after the acquisition. It is believed that the founder, Adrian Zecha, will also move on from the chain after the takeover.

The acquisition also entails DLF taking over a prime property at Delhi's Lodhi Road. Amanresorts had bought this property from the India Tourism Development Corporation five years ago for Rs 76.22 crore.

The old building has been demolished and a new one, currently under construction, should be operational in another six months.

Being developed as a super-luxury resort, room tariffs at the property are also expected to range between $600 and $700 per night, making it one of the most expensive hotel rooms in the country.

"DLF is getting an opportunity to gain access to the super-luxury hospitality market with this acquisition. The Aman brand name will continue even after the acquisition," said a company executive, who declined to be identified.

DLF forayed into hospitality last year. It has a 74:26 joint venture agreement with Hilton International for developing 50 to 75 properties in the long term.

DLF's initial roll out plan in India includes eight to 10 luxury hotels (it has also tied up with the Four Seasons for a property overlooking the DLF Golf & Country Club at Gurgaon), 25 or 30 business hotels and 10 to 15 serviced apartments.

Nayantara Rai in New Delhi