Phoenix Mills surges 8% on signing strategic deal with GIC affiliate

NEW DELHI: Shares of Phoenix Mills climbed neary 8 per cent in Wednesday's trade after the company, along with three of its subsidiaries, entered into a non-binding term sheet with an affiliate of GIC for a strategic retail-led mixed-use development platform.

As per the BSE filing, the company will contribute Phoenix Marketcity (Mumbai) and Phoenix Marketcity (Pune), and commercial assets such as Art Guild House, Phoenix Paragon, Plaza and Centrium, Mumbai, as a part of the platform.

Following the development, the stock rose 7.62 per cent to hit a high of Rs 742.10 on BSE.

"Together the assets, which are held by the Phoenix subsidiaries, constitute a retail gross leasable area (GLA) of approximately 2:33 million square feet and office GLA of approximately 1.03 msf, aggregating to GLA of 3.36 msf with FY20 net operating income of approximately Rs 370 crore," the company said.

Phoenix Mills' asset contribution is indicatively valued at an approximate enterprise value of Rs 5,600-5,700 crore, subject to due diligence and adjustments, if any.

"GIC will invest in the Phoenix subsidiaries by way of a combination of primary infusion and secondary purchase of equity shares. Subject to mutually agreed terms and conditions between the parties, GIC will initially acquire an equity stake of 26 per cent; the parties to the transaction may mutually agree for GIC to further increase its stake up to 35 per cent within a 12 month period from the closing of the proposed transaction," the company said.