This story first appeared in DNA Money edition on Friday, Aug 16, 2013.
Despite slowdown in the hospitality business, Aman Resorts, realty major DLF’s hospitality chain, has seen significant improvement in both operations and perceived valuation, lifting the parent’s hopes of selling Aman profitably and cut its own heavy debt.
In fact, the hotels business has contributed Rs 10.4 crore to DLF’s first quarter consolidated net profit of Rs 181 crore, a turnaround from loss-ridden quarters of last fiscal.
In an earnings call, Ashok Tyagi, group CFO, DLF, cited improved operations and better foreign exchange translation as key reasons for Aman operations turning profitable.
To divest non-core assets and reduce debt, DLF agreed to sell the Aman Resorts portfolio (excluding Aman Hotel, Delhi) back to its founder Adrian Zecha for $300 million.
Zecha was, however, not able to arrange the funds in time, leading to expiry of the exclusivity period in June. The DLF management later initiated discussions with a few other buyers even as Zecha remains in the fray.
Tyagi said the company was confident of closing the Aman Resorts deal soon and that the transaction will be value-accretive compared to its earlier valuations.
Saurabh Chawla, ED-finance, DLF, said, the hotel business will likely post an Ebitda number of $20 million this fiscal on the back of “an exceptionally good January-June period” and given that the group is “slated to open four properties across the globe”.
The DLF management will be expecting increase in the valuation of Aman Resorts, considering that new hotels / resorts in international markets like Italy, China, Vietnam and Jordan will be added to its portfolio, and the business has also started generating profits.
Despite slowdown in the hospitality business, Aman Resorts, realty major DLF’s hospitality chain, has seen significant improvement in both operations and perceived valuation, lifting the parent’s hopes of selling Aman profitably and cut its own heavy debt.
In fact, the hotels business has contributed Rs 10.4 crore to DLF’s first quarter consolidated net profit of Rs 181 crore, a turnaround from loss-ridden quarters of last fiscal.
In an earnings call, Ashok Tyagi, group CFO, DLF, cited improved operations and better foreign exchange translation as key reasons for Aman operations turning profitable.
To divest non-core assets and reduce debt, DLF agreed to sell the Aman Resorts portfolio (excluding Aman Hotel, Delhi) back to its founder Adrian Zecha for $300 million.
Zecha was, however, not able to arrange the funds in time, leading to expiry of the exclusivity period in June. The DLF management later initiated discussions with a few other buyers even as Zecha remains in the fray.
Tyagi said the company was confident of closing the Aman Resorts deal soon and that the transaction will be value-accretive compared to its earlier valuations.
Saurabh Chawla, ED-finance, DLF, said, the hotel business will likely post an Ebitda number of $20 million this fiscal on the back of “an exceptionally good January-June period” and given that the group is “slated to open four properties across the globe”.
The DLF management will be expecting increase in the valuation of Aman Resorts, considering that new hotels / resorts in international markets like Italy, China, Vietnam and Jordan will be added to its portfolio, and the business has also started generating profits.
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