New Delhi: Realty firm Parsvnath Developers has sold development rights of its township project in Gurgaon to another builder, Supertech for an estimated Rs 700 crore mainly to cut debt.
In a filing to the BSE, Parsvnath Developers has informed that "the company has entered into a transaction with Supertech Ltd, in terms of which the company has transferred the development rights held by it in the township project at Sohna Road, Gurgaon".
Parsvnath has also transferred its shareholding in Honey Builders Ltd, with whom the company has held joint development rights in this project to Supertech, the filing added.
The company did not gave any financial details.
Sources, however, said Parsvnath has about 140 acres of land in this township project, of which about 100 acres are licensed. The transaction value is estimated at about Rs 700 crore, they added.
Parsvnath Developers Chairman Pradeep Jain could not be reached for comments.
The deal is as part of company's strategy to reduce debt, which currently stands at about Rs 1,200 crore, and also fast track execution of ongoing projects estimated at 80 million sq feet.
In June, the company had announced plans to either sell the land parcels worth Rs 1,000 crore in south and west India or form joint ventures with local builders for development.
In the company's annual report, Jain told shareholders that the company has laid out a clear set of priorities for the next 12-24 months to improve profitability.
"The strategic focus is on assessing and evaluating our assets, business and markets, and accordingly sell non-core assets that are not aligned with our core business in terms of development potential. We are also working towards asset monetisation by raising long-term capital to reduce the debt," he added.
Parsvnath plans to raise up to Rs 1,000 crore through private placement of non-convertible debentures (NCDs) and is also looking at selling non-core assets to reduce debt.
The company has called an annual general meeting on 23 September to seek shareholders' approval on a special resolution related to the private placement of NCDs.
Parsvnath Developers reported 61 percent fall in consolidated net profit to Rs 6.14 crore for the quarter ended June as against Rs 15.55 crore in the year-ago period.
Total income from operations fell by 49 percent to Rs 96.34 crore in the first quarter of this fiscal as against Rs 188.86 crore in the corresponding period of previous year.
