Indiabulls Group to exit real estate biz to focus on banking

A deal has been sealed, wherein the Embassy Group, a local partner of multinational private equity firm Blackstone Group, will buy approximately 15 per cent promoter stake in Indiabulls Real Estate.

Following the deal, Indiabulls Group's main business focus will be financial services and real estate will account for only 10 per cent of its revenue, said news reports on Friday. The group believes that exiting the real estate business operations will help in getting RBI approval for the merger of its subsidiary Indiabulls Housing Finance Limited (IHFL) with Lakshmi Vilas Bank (LVB). This is some sort of sacrifice by the group, said top management officials of the comany in an interview to a news outlet. Post completion of the deal, the merger between IHFL and LVB is expected to be fast-track and this is one of the chief reasons for the company to dispose of its real estate business. It will take around 9-12 months for the merger between IHFL and LVB to conclude.

Reacting to this development, the stock of Indiabulls Real Estate was trading at Rs. 134.95 per share, an increase of Rs. 3.35 or 2.55 per cent than the previous close. The 52-week high being Rs. 180.40 and 52-week low being Rs.63.05 on the BSE.