Cash-strapped Hotel Leela Venture sells off hotel assets
India’s Hotel Leela Venture has agreed to sell four hotels and a property to Canada based firm Brookfield Asset Management.
It is offloading Leela hotels in Bengaluru, Chennai, Delhi, and Udaipur and its property in Agra for $576 million.
The deal will also see the Leela brand name transferred to an affiliated real estate fund of Brookfield for all hospitality operations including current hotel contracts.
Hotel Leela Venture will use the funds to repay lenders.
Brookfield Asset is a major global player with assets worth about $350 billion across multiple sectors.
Leela Venture will continue to operate its hotel in Mumbai and is also developing a residential apartment complex in Bengaluru.
The company has a portfolio of nine properties it owns or manages across India but has struggled to stay afloat in recent years.
Last month it was facing an insolvency petition filed in Mumbai and has been looking at all options to repay debt.
Hotel Leela is now losing the lion’s share of its business. The hotel business unit accounts for nearly 90% of its current net worth.
At one time among India’s top luxury hospitality companies, it has struggled to repay high debt incurred during its expansion phase following the financial crisis of a decade ago.
source: Travel Mole