Shardul Amarchand Mangaldas Advises DLF Limited on Sale of Stake in DLF Cyber City Developers Limited to GIC

Shardul Amarchand Mangaldas & Co (SAM & Co) advised DLF Limited in relation to sale of stake in DLF Cyber City Developers Limited (DCCDL) to GIC Group, Singapore, in a multi-stage transaction.  The deal, valued at USD 1.9 billion, involves a combination of secondary purchase and two rounds of buyback, to give effect to the agreed commercial terms.

SAM & Co team advised on all aspect of the transaction. It involved:

• advising DLF in relation to regulatory, corporate governance and structuring advice, drafting, negotiating and finalising the transaction documents, stock exchange notifications and corporate authorisations for DLF and DCCDL.

• advising the Board and the Audit Committee of DLF on various structures in relation to resolving the conflict of interest in the ownership of the commercial rental business which culminated in the current transaction structure.

• advising in the auction process that culminated in this sale transaction, which involved inter alia drafting and negotiation of non-disclosure agreements, bid terms and related bid processes with several potential buyers.,

• conducting the vendor legal due diligence over DCCDL and 13 other group companies of DCCDL (having projects across India) in relation to the transaction.

The Transaction Team was led by Shardul Shroff, Executive Chairman and Akila Agrawal, Partner and included Mukul Sharma and Navin Kumar, Principal Associates, Ishita Khandelwal and Sumi Saikia, Senior Associates.

The Real Estate Team was led by Mrinal Kumar and Avnish Sharma, Partners and included Shrutikirti Kumar, Senior Associate.

The Competition Law Team is being led by Shweta Shroff Chopra and Manika Brar, Partners and includesSupritha Prodaturi and Akkriti Bhatt, Associates.

The legal due diligence team consisted of Megha Bhargava, Principal Associate, Rohan Mahendar Arora,Principal Consultant, Ishan Gaur, Vaibhav Bhardwaj and Sourav Nath, Senior Associates, Saurabh Arora,Consultant, Roli Sharma, Rajashree Ravi, Aditya Seth, Kostubh Devnani, Pragya Seth, Akshay, Divya Chaudhary, Srishti Khare, Ritika Sinha, and Ananya Kulkarni, Associates.

The proposed transaction envisages an enterprise value of INR 35,617 crore (approx. US$ 5.6 billion) for DCCDL. Post completion of series of steps as contemplated under the proposed transaction, DLF will hold 66.66% equity shares (up from 60% diluted equity earlier) and GIC affiliate will hold 33.34% equity shares in DCCDL. The gross sale proceeds to the sellers from the proposed transaction would be INR 11,900 crore (approx. US$ 1.9 billion), which comprises secondary sale of equity shares (post conversion of CCPS) to the GIC affiliate for approx. INR 8,900 crore (approx. US$ 1.4 billion) and 2 buybacks of CCPS by DCCDL for INR 3,000 crore (approx. US$ 0.5 billion). 

The parties involved in the transaction were DLF Limited (Our Client); Reco Diamond Private Limited, an affiliate of GIC, Singapore (Counterparty).

Other advisors to the transaction were EY (Transaction advisor to DLF), Morgan Stanley and JP Morgan (Financial advisers to DLF), AZB & Partners (Legal advisor to GIC, Singapore) and Wadia Ghandy & Co (Legal advisor to GIC, Singapore on real estate matters).

The deal was signed on August 27, 2017 and is expected to close by November, 2017.

About Shardul Amarchand Mangaldas & Co

With the legacy of a century, Shardul Amarchand Mangaldas & Co, established in 2015, is one of India’s leading law firms rated by international organisations, law directories and professional journals. As a full service law firm, Shardul Amarchand Mangaldas is renowned in the business community for its ability to enable business, its innovative solutions, responsiveness and collaboration with its clients. The Firm continues its journey as “a young and wise firm” in its “Centenary Year of Excellence”.

Currently, the Firm has over 510 lawyers, including 91 Partners, offering legal services through its offices at New Delhi, Mumbai, Gurugram, Ahmedabad, Kolkata, Bengaluru and Chennai.