Unitech seeks funding from affiliates of Unitech Corporate Park, Plc

Unitech Ltd has announced that the Company is seeking funding from affiliates of Unitech Corporate Park, Plc ("Company"), a newly incorporated Company in the Isle of Mann in respect or one Information technology (“IT”) Park and five potential IT Special Economic Zone (“SEZ”) projects. The Company (i.e., Unitech Corporate Park, Plc) is seeking admission of its Ordinary Shares (“Admission”) on the London Stock Exchange’s AIM market.

On Admission, the entire planned proceeds of the offer, net of provisions for launch and future expenses, will be used by the Company (i.e., Unitech Corporate Park, Plc) to co-invest in and acquire a majority stake in a portfolio of six seed portfolio assets proposed to be developed with specific focus on the high growth IT and IT Enabled Services ("ITES”) sectors in India that are suitable for foreign direct investment.

Five of the seed portfolio assets are located in the National Capital Region and one in the Kolkata area. Five of the seed portfolio assets have received in-principle approvals and two out of five have received the recommendation of the respective state government for establishing SEZs and the sixth asset has certain approvals for establishing an IT Park. The seed portfolio assets have been valued at an aggregate amount of Rs 41,373 million by Jones Lang LaSalle Property Consultants (India) Pvt Ltd, international property consultants. The affiliates of the Company (i.e., Unitech Corporate Park, Plc) shall invest in a minimum of 60 percent of the paid up share capital of the seed portfolio assets with Unitech or its affiliates and the terms of investment would he decided by mutual agreement between the parties.

Pursuant to an investment management agreement between Nectrus Ltd (a Unitech affiliate incorporated in Cyprus) (“Nectrus”), the Company (i.e., Unitech Corporate Park, Plc) and Candor (a wholly owned subsidiary of the Company (i.e., Unitech Corporate Park, Plc)), Nectrus will act as the advisor to the Company (i.e., Unitech Corporate Park, Plc), in order to provide non-binding advisor services to the Candor and receive payment of certain agreed fees for its services.

Candor has the option of co-investing a minimum equity interest of 50 percent plus one share in IT Park/ IT SEZ focused projects in which Unitech (directly or indirectly) holds an equity interest over a particular threshold and which (i) has a minimum buildable area of at least 1,000,000 square feet and (ii) has received approval from the relevant government authority (in respect of an IT Park) or for which “in-principle” approval has been obtained from the relevant authorities (in respect of an IT SEZ)- The terms of the co-investment option are to be set forth in an agreement to be entered into between Candor and Unitech.

In addition to the above, in respect to each of such projects, Unitech would act as the project management consultant under the terms of a project management agreement and would receive a specified fee for the same. The project manager would administer, oversee and co-ordinate the construction and development in respect of the seed portfolio assets including providing assistance with the marketing of all projects to prospective tenants and management services in respect of the completed projects pending sale. Unitech may provide the same services in respect of new projects on terms to be mutually agreed.

Brief overview of the seeded portfolio assets:

InfoSpace, Sector 62, Noida:

Shantiniketan Properties Ltd (“SPL”) is the developer of N1, a 19.25 acre site located close to the National Highway 24 in Noida. SPL has been wanted a lease by the Noida Authority for 90 years for the purpose of setting up an IT Park on the project site. N1 is being developed as an IT Park and is designed to provide (approximately) 1.97 million sq. ft. of office space and (approximately) 60,000 sq. ft. of commercial space and to include facilities such as food courts, a gymnasium, coffee shops and other amenities. The completed project at N1 will provide (approximately) 2.03 million square feet of leasable area surrounded by a landscaped common area.

InfoSpace, Sector 135, Noida:

Seaview Developers Ltd (“SDL”) is the developer of N2, a 29.65 acre site situated in Sector 135, next to the expressway connecting Noida to Greater Noida. SDL has been granted a lease by the Noida Authority for 90 years for the purpose of setting up an IT Park on the project site. SDL has also received an in-principle approval from the board of approval a recommendation from the government of Uttar Pradesh for establishing IT SEZ on the project site. N2 is designed to provide (approximately) 3.13 million square feet of leasable area consisting of (approximately) 3.07 million square feet of office space and (approximately) 60,000 square Feet of commercial space.

InfoSpace, Greater Noida:

Unitech Infra-Con Ltd ("UICL”) is the developer of N3, a 50 acre site situated in Greater Noida allotted by the Greater Noida Authority. The entire plot of land on which N3 is located is 74.75 acres. However UICL has entered into a joint development agreement with Unitech with respect to 24.75 acres. It has received an in-principle approval from the SEZ board of approval and recommendation from the Uttar Pradesh Government for land admeasuring (40.94 acres) for establishing IT SEZ on the project site. The application has been made to the Ministry of Commerce and Industry, EPZ Section for extension of SEZ to balance area. N3 is designed to provide (approximately) 4.95 million square feet of leasable area consisting of (approximately) 4.85 million square feet of office space and (approximately) 10,000 square feet of commercial space.

InfoSpace, Gurgaon:

Unitech Realty Projects Ltd (“URPL”) is the developer of G1, a 24.7 acre site situated at Tikri, Gurgaon. URPL has acquired the land from Unitech and Unitech Residential Resorts Ltd and is the freehold owner of the said land. URPL has received an in-principle approval from the SEZ board of approvals for establishing IT SEZ on the project site. G1 is designed to provide a total leasable area of (approximately) 3.26 million square feet consisting of (approximately) 3.21 million square feet of office space and (approximately) 50,000 square feet of commercial space.

InfoSpace Dundehera, Gurgaon:

G2 is being developed by Unitech Developers and Projects Ltd (‘UDPL”) pursuant to a joint development agreement with IST Ltd and Gurgaon Infospace. The 28.4 acre site situated at Dundehera, Gurgaon is owned by IST Ltd and UDPL has exclusive developmental rights in respect of the property pursuant to the joint development agreement. UDPL has received an in-principle approval from the SEZ board of approvals for establishing IT SEZ on the project Site. G2 is designed to provide a total leasable area of (approximately) 3.75 million square feet consisting of (approximately) 3.7 million square feet of office space and (approximately) 50,000 square feet of commercial space.

InfoSpace, Kolkata:

Unitech Hi-Tech Structures Ltd ("UHTSL”) is the developer of K1, a 48.37 acre site situated at New Town, Rajarhat, Kolkata. Bengal Housing and Infrastructure Development Corporation Ltd allotted the project site to Bengal Unitech Universal Infrastructure Pvt Ltd (“BUUIPL”) on a freehold basis for IT use pursuant to an allotment letter dated October 19, 2006. BUUIPL has granted a lease to UHTSL for a period of 90 years, with an option by UHTSL to renew for a further 20 years. UHTSL has received an in-principle approval from the SEZ board of approvals for setting up the IT and ITES SEZ on January 17, 2006 for land admeasuring 25.01 acres on the project site. UHTSL has made an application dated October 26, 2006 to extend the area for setting the IT and ITES SEZ to 48.37 acres. K1 is designed to provide a total leasable area of (approximately) 4.35 million square feet consisting of (approximately) 4.25 million square feet of office space and (approximately) 100,000 square feet of commercial space.

Source : Equity Bulls

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