Kolte-Patil Developers Allots Preferential Shares To Blackstone In First Steps Towards Acquisition

Pune-based realtor Kolte-Patil Developers Ltd. allotted shares amounting to Rs 417 crore to US private equity major Blackstone on Monday.

The board approved the preferential allotment of 1.26 crore shares, representing 14.3% equity, to Blackstone affiliate BREP Asia III India Holding Co VII Pte., at Rs 329 per share, according to a stock exchange filing.

Earlier this month, the Competition Commission of India approved Blackstone's acquisition of Kolte-Patil Developers. The deal was announced in March.

Following the preferential issue, the Blackstone entity can now acquire a 26% stake for Rs 759 crore through a share purchase agreement.

With a 40% shareholding, BREP Asia III India Holding Co. will be classified as one of the promoters of Kolte Patil and will have joint control, after the agreement is completed.

An open offer for an additional 26% stake will be made to minority shareholders.

So far, Blackstone has primarily invested in platforms catering to commercial real estate, retail assets, office spaces, data centres and warehousing. The Kolte-Patil acquisition provides Blackstone a foothold to expand into the residential rental business and acquire future assets in this sector.

Kolte-Patil has a strong presence in Pune, recognised as an IT hub in Maharashtra. The company is also making inroads in Mumbai and Bengaluru. The company is expected to transition from residential sales to student housing and rental housing targeted at the IT workforce in key service markets, such as Pune, Bengaluru and Mumbai.

Shares settled 5.46% higher at Rs 465.15 apiece on the NSE, compared to a 0.56% decline in the benchmark Nifty 50.