L&T Metro Rail sells 15 acres at Raidurg Metro station in Hyderabad to Rafferty Developments for Rs.1,500 cr

HYDERABAD: Larsen and Toubro Metro Rail Hyderabad has sold 15 acres of land, allotted by the State Government for future uses of the metro rail project, near Raidurg Metro Station to Rafferty Developments Pvt Ltd. L&T Metro Rail Hyderabad Legal Head, Company Secretary Chandrachud D. Paliwal informed BSE (Bombay Stock Exchange) on Wednesday in a filing saying that the company took this decision at an extraordinary general meeting held on August 16.

The L&T described the sale as a 'slump sale', and the estimated value of the land is reportedly around Rs. 1,500 crores. The State Government had initially allotted this land to L&T for future requirements as part of their agreement and L&T had already constructed a building on 9 acres of this land, at Rs. 200 crores.

However, L&T in the last year decided to sell the entire 15 acres of land and the building to generate income for purposes such as Metro Rail maintenance and achieving break-even. The L&T was engaged in discussions with the consortium of K Raheja and Brookfield companies ehoch jointly own Rafferty Company, and sold the land on Wednesday for an estimated value of Rs. 1,500 crores.

In a statement released to the BSE, L&T Metro Rail Hyderabad said that the approval of the Government of Telangana State had been obtained and members of the Company in its “extraordinary general meeting held on Wednesday, 16th August 2023 approved the consummation of the proposed sale of the Raidurg business undertaking of the Company (“Concessionaire”) as a going concern by way of a slump sale in favour of Rafferty Developments Private Limited (‘Purchaser’) (a company jointly held by Brookfield Corporation and K Raheja Corp Limited) subject to fulfillment of transaction formalities and receipt of other required approvals and finalisation and execution of transaction documents.”

As per the agreement with the State government, L&T is allowed to develop the land for 33 years but is prohibited from selling it. It remains to be seen whether the control of the land will be returned to the government after 33 years of agreement or if it will be owned by Rafferty company.

Earlier in September 2022, Larsen &Toubro signed MoU with Brookfield Group to transfer around 15 acres of land along with 12 storeys building through a 50-year lease for a whopping Rs 1,020 crore. The decision was made by the company to overcome the financial burden. The said land was alloted to the L&T in 2010 in undivided Andhra Pradesh.