Bombay Dyeing to Offload 22-Acre Mumbai Worli Land to Japan's Sumitomo for Rs 5,200 Crore

Bombay Dyeing & Manufacturing Company Ltd announced on Wednesday that its Board of Directors had given the green light to a proposal for selling a land parcel of approximately 22 acres in Worli, Mumbai to a subsidiary of the Japanese conglomerate Sumitomo. The deal is valued at Rs 5,200 crore.

In a stock exchange filing, Bombay Dyeing, owned by the Wadia group, stated, "The Board of Directors of The Bombay Dyeing and Manufacturing Company Limited (BDMC) approved the proposal to sell the land parcel of about 22 acres (along with the associated FSI) in Worli, Mumbai, to Goisu Realty Private Limited (a subsidiary of Sumitomo Realty & Development Company Limited) ("Buyer") in two phases, for a total consideration of about Rs 5,200 crore, subject to approval by its shareholders."

Upon receiving shareholder approval, BDMC will receive approximately Rs 4,675 crore from the buyer for Phase-I, with the remaining amount of about Rs 525 crore to be received upon the fulfillment of certain conditions by BDMC and the execution and consummation of definitive agreements for Phase-II.

Nusli Wadia, Chairman of Bombay Dyeing, expressed his satisfaction with the development, stating, "I am happy to inform that BDMC is entering into agreements with Sumitomo group for the sale of about 22 acres of land (along with the associated FSI) in Worli, Mumbai, for a total consideration of about Rs. 5,200 crore."

Furthermore, the company revealed that the Board had given in-principle approval for the development of the unused land parcels held by the company, with the potential to create approximately 3.5 million square feet of residential and commercial property, generating an estimated revenue of about Rs 15,000 crore over the coming years. The development will be strategically planned in phases to manage the company's cash flows efficiently. Additionally, Bombay Dyeing will explore other joint development and partnership opportunities to establish a steady pipeline of future revenue and profits.

On the same day, Bombay Dyeing's stock on the Bombay Stock Exchange (BSE) closed 7% higher at Rs 140.5.

In the previous month, the Mumbai-based company reported a consolidated net loss of Rs 120 crore for the June quarter, which was higher than the Rs 77 crore loss recorded a year earlier.

The Wadia group has been grappling with challenges following the bankruptcy filing of its Go First airlines in May. The airline attributed its financial troubles to "faulty" Pratt & Whitney engines, which led to the grounding of approximately half of its fleet.