Billionaire Lakshmi Mittal and Farallon Capital Management LLC invested a combined $399 million in a power unit of Indiabulls Real Estate Ltd., India's fourth- biggest developer by market value.
The developer, partly owned by Goldman Sachs Group Inc. and Merrill Lynch & Co., said it sold 37.5 percent of Sophia Power Company Ltd. Farallon will buy 23.4 percent and Mittal will buy the rest, the company said in an e-mailed statement from Mumbai.
Indiabulls is investing more in electricity as the nation seeks funds to bolster power generation, roads and ports to sustain a 9 percent target for economic growth. The world's fastest-growing major economy after China faces a peak electricity shortage of 13 percent and plans to add 78,577 megawatts of capacity in the five years to March 2012.
The combined stake bought by Mittal and Farallon will drop to 28.6 percent after a proposed merger between Sophia Power and Indiabulls Power Services Ltd., a fully owned unit of Indiabulls Real Estate, said Ajit Mittal, head of investor relations at Indiabulls Real Estate, in a telephone interview.
Indiabulls Real Estate may raise $1.2 billion selling shares in a proposed investment trust to be listed on the Singapore Stock Exchange, two people familiar with the sale said earlier this month.
Shares of the real estate company have more than doubled since it listed in March after being spun off from Indiabulls Financial Services Ltd. Lakshmi Mittal, Citigroup Inc. and Merrill Lynch are among shareholders of the financial services company.
Indiabulls Real Estate traded 2.1 percent higher at 637 rupees on the Bombay Stock Exchange at 11:22 a.m. The developer has projects covering 10,000 acres of land, according to its Web site. It is building office space in central Mumbai, a special economic zone at Raigarh near Mumbai and a residential project in New Delhi, among other projects.
The company, which also plans to open 30 shopping malls in a year, raised $400 million selling shares overseas in July last year.
Source: Bloomberg