The Phoenix Mills Limited has informed the Exchange about Acquisition
PHOENIXLTD · price
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The Phoenix Mills Limited will buy out Canada Pension Plan Investment Board's (CPP Investments) entire 49% stake in its material subsidiary, Island Star Mall Developers Private Limited (ISMDPL), for a total cash consideration of Rs. 5,449.16 Crores. Currently, Phoenix Mills holds 51% and CPP Investments holds 49% in ISMDPL; post-transaction, ISMDPL will become a 100% wholly owned subsidiary. The payment will be made in four tranches spread over three years through a combination of dividends, buybacks, capital reduction, or direct acquisition. The deal is subject to shareholder and Competition Commission of India (CCI) approvals. ISMDPL runs Phoenix MarketCity Bengaluru and its subsidiaries operate Phoenix Mall of Millennium (Pune), Phoenix Mall of Asia (Bengaluru), and Phoenix Citadel (Indore), with a consolidated FY25 turnover of Rs. 919.73 Crores.
This is a large consolidation move — Phoenix Mills will gain full control of a high-performing commercial and retail real estate platform, which management expects to be financially accretive. However, the Rs. 5,449 Crores payout (structured over 3 years) is significant relative to ISMDPL's net worth of Rs. 3,960 Crores, so shareholders should watch the funding mix and impact on leverage. Existing shareholders will benefit from full ownership economics but will need to approve the related-party transaction.