Temasek to invest $51m in India’s Oberoi Realty through preferential share issue

Logo of Oberoi Realty

Oberoi Realty, India’s second largest realtor by market capitalisation, has raised $51 million in funding from Singapore state fund Temasek Holdings. The investment was routed though Tamesek subsidiary Aranda Investments. Oberoi Realty has proposed to make a preferential allotment of 11 million shares to Temasek, resulting in a 3.2 percent stake.

Since the global financial crisis, most PE deals in the Indian property sector are project-level investments. Most realty PE deals are financed through debt securities with fixed rates of return. A prior investor of Oberoi Realty is Morgan Stanley Real Estate (MSER), the property-focused asset management arm of Morgan Stanley.

Morgan Stanley invested in in Oberoi Realty in 2007, prior to its initial public offering (IPO) in 2010. According to a VCCircle report, MSER holds a 3.2 percent stake after divesting a significant portion of its take in 2014.

Early in June, Oberoi Realty secured board approval to raise $353.4 million through an issue of debentures and equity shares. Oberoi intends to raise up to $235.6 million through non-convertible debentures and equity shares and $117.8 million through any other form of securities.

 

Also ReadTemasek completes acquisition of SVB India, rebrands it InnoVen

Temasek to invest $151m in India’s Glenmark Pharma

Singapore SWF Indian exposure

Singapore is traditionally amongst the largest and most active foreign investors in India, alongside Mauritius, the UK, USA, Germany and the Netherlands. Singapore surpassed Mauritius as the largest gateway for foreign direct investment (FDI) capital inflows into India in FY 2013/2014, as well as emerging as a major destination for India’s outbound investments in 2015.

Temasek is one of the most active investment firms in India and Oberoi Realty is its second investment in real estate, five years after its last investment in Bangalore-based realtor Sobha Ltd through a secondary market transaction in 2010. Temasek has gradually exited Sobha and completed a full exit over a year ago.

However, this does not account for deals involving its international portfolio firms like Mapletree and CapitaLand. Mapletree purchased Global Technology Park – a Bangalore IT park. Meanwhile, CapitaLand’s maintains assets in the Indian real estate space.

This is the sixth new investment for Temasek in India since January, making 2015 the most active year to date. Since January 2015, its purchase include Silicon Valley Bank’s Indian venture debt arm (InnoVen Capital); investments in Sun Pharma, Glenmark Pharma and Medanta and collaborating with PE firm Advent to purchase Avantha Group’s stake in Crompton Greaves’ consumer products business.

Given the strong activity of Singapore’s sovereign wealth funds in India, GIC has also seen increased deal flow in the residential and commercial segments of India’s property market. It recently increased its stake in Mumbai IT park firm Nirlon Ltd to 63.92 percent earlier this year, as reported here.

In the commercial space, it purchased a special economic zone (SEZ) property from Hindustan Unilever Ltd, under a joint venture with Brigade Group. It also maintains a separate joint investment platform with Brigade Group for residential projects. GIC has additionally sealed two joint ventures with Vatika Group for residential townships.

GIC is also discussing the acquisition of Shriram The Gateway – an IT special economic zone – from Shriram Properties It is also a front-runner amongst several firms to purchase a majority stake in Exora Business Park, a joint venture between realty PE firm Red Fort Capital and Bangalore-based Prestige Group.

Also Read: Temasek-backed Univar conducts IPO, raises $770m

Temasek to buy Intel Cap’s stake in Policybazaar: Report

Temasek-owned Fullerton India to establish home finance arm

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.