Emaar Properties, MGF to part ways, end 11-yr-old JV
New Delhi, April 13
Dubai-based realty firm Emaar Properties and India’s MGF Development have decided to end their 11-year-old joint venture through demerger of Emaar MGF Land Ltd into two separate entities.
Emaar Properties, which entered India in 2005 with largest FDI in the realty sector, has invested about Rs 8,500 crore in Indian real estate market through its JV firm Emaar MGF.
The two partners held about 49% stake each in the joint venture firm and the rest by financial institutions.
The JV has currently a land bank of around 8,000 acres and 53 ongoing residential and commercial projects.
In a filing to Dubai Financial Market, Emaar Properties said it has “agreed to take steps for the reorganisation of Emaar MGF Land by way of scheme of arrangement (demerger)”.
The reorganisation is being done to give greater focus on its Indian operations and for the purpose of developing the potential for further growth and expansion of the business, said the Dubai-based company, which built the world’s tallest tower Burj Khalifa.
“This reorganisation will enable Emaar to implement the focused strategy for its real estate business in India and will allow the business to undertake future expansion strategies. It will also enable Emaar to drive the development of ongoing projects in India,” Emaar Properties said Separately, Emaar MGF said the Board in its meeting held on April 11 decided to take steps for reorganisation of the company through a scheme of demerger to be filed in the court citing similar reasons.
The Board authorised the company to execute necessary agreements and documents in respect thereof.
Although both Emaar Properties and the JV firm Emaar MGF did not clearly stated in their regulatory filings, sources said the two main partners have agreed to part ways. “The joint venture will be demerged into two separate entities. This is being done to facilitate capital in the company and delivery of the projects,” a senior company official associated with the process said. — PTI
