Emaar MGF Set for Significant Investment from Top Financial Institutions
Advanced Talks with Goldman Sachs, Deutsche Bank, and Another Investor
Delhi-based real estate major Emaar MGF is in advanced discussions with prominent financial institutions, including Goldman Sachs and Deutsche Bank, for a substantial investment. The proposed investment, valued at approximately $800 million, will be divided among three Special Purpose Vehicles (SPVs) created by Emaar MGF. Each SPV is expected to have one financial investor on board.
Impending Deals Amid Challenging Market Conditions
Emaar MGF is likely to finalize these three separate deals within the next 30 days, marking a significant inflow of capital into the company since February. This development comes after the company was forced to withdraw its Initial Public Offering (IPO) of approximately ₹7,000 crores due to unfavorable market response.
Market Response Impacts Other Real Estate Firms
The poor market response also prompted other major real estate developers, including DLF, Unitech, and Indiabulls, to suspend the Singapore listing of their Real Estate Investment Trusts (REITs). Despite this, the flow of funds into the real estate sector has continued, albeit with a shift in strategy.
Shift Towards Private Equity Funding at Project or SPV Level
Developers are increasingly opting for private equity funding at the project or SPV level, rather than seeking equity dilution at the parent company level, primarily due to concerns over lower valuations. This strategic adjustment has led Emaar MGF and other developers to explore alternative funding avenues, such as the proposed investments from Goldman Sachs, Deutsche Bank, and the third unidentified investor.
No Official Comment from Emaar MGF
As of the latest update, Emaar MGF has not provided an official statement regarding these impending investments.