Mumbai: Birla Estates, the real estate division and a subsidiary of Century Textiles and Industries, will be buying Hindalco Industries’ Kalwa property for Rs 595 crore. The documents and agreements towards the sale will be signed in the weeks to follow. It will take approximately 15 months for the transaction to be completed.
“Around Rs 595 crore to be received in multiple tranches over a period of time and 1.5% of the sales revenue,” announced Hindalco Industries in a regulatory filing.
Proceeds from sale to be utilised for general corporate purpose
The decision to monetise on the real estate asset was taken in a Board of Directors meeting of the world’s largest flat rolled products player and recycler of aluminium – Hindalco Industries. The meeting was held on Wednesday.
The company plans to deleverage its debt and utilise part of the proceeds from this sale for general corporate purpose.
For about eight years, the sale of the prime 33-acre land has been on the cards for Hindalco Industries. Back in April 2015, the Aditya Birla Group’s company had initiated the plans to sell the land through a bidding process. It had finalised land’s valuation for around Rs 1,500 crore and was to initiate the auction process.
Kalwa plant shut in 2010
In 2010, the company had decided to shut down the Kalwa plant, where aluminium foil was processed as running the unit was economically unviable. The operations were moved elsewhere in India.
The Kalwa aluminium foil plant had an annual manufacturing capacity of about 6,000 tonnes to cater to the packaging requirements of personal healthcare, pharmaceutical, confectionary and processed food industries.
As Mumbai is an island city and the real estate cost here is one of the highest in the world, the requirement of housing needs is getting fulfilled with housing development happening towards the north of Mumbai, which comes under the rest of the Mumbai Metropolitan Region.
