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CITI group’s realty arm, Citi Property Investors (CPI), has bought 40% stake in each of the four Special Economic Zones (SEZs) of Delhi-based real estate group BPTP for $160 million (approx Rs 640 cr). The fund raised will be used to pay the first instalment of Rs 5,006-crore Noida land deal which BPTP bagged recently, a BPTP official said. CPI, which manages approximately $13.0 billion in gross real estate assets globally, had last year taken an equity stake of 5.89% in BPTP by investing Rs 322.5 crore. Besides Citi, Merrill Lynch’s real estate arm also invested in the BPTP group last year. Merrill bought 49% stake in an SPV developing 4.5-acre IT park on the Gurgaon Expressway for Rs 112.55 crore. Almost a month ago, the consortium, comprising BPTP and its three subsidiaries, won the bid for 95-acre plot in Noida’s sector 94, which saw participation from real estate giants such as DLF, Omaxe and Ansal API.

The company is expected to make a staggered payment, with only 25% of the total amount to be paid by April 12. The company has to pay the rest in sixteen instalments over eight years, alongwith an interest of 11% compounded annually on the due amount. Given the state of internal accruals- BPTP estimates its revenue for 2007-08 at Rs 1,200 crore and net profit at Rs 400 crore, it could have been impossible for the real estate firm to make the first instalment of payment without the injection of fresh funds from outside.

BPTP is developing four IT/ITeS SEZs in the national capital region. The SEZ at Noida is spread over 25 acres while that of Greater Noida covers 100 acres. Faridabad SEZ would come up in 54 acres whereas the company would develop the Gurgaon SEZ in 27 acres. The company is also planning to launch IPO sometime this year. It had announced last year its plan to raise Rs 1,500 crore from public issue in January this year. But the plan has been delayed due to volatility in the capital market.

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