MUMBAI: PVR Limited has entered into an arrangement with Infinite India Investment Management for the sale and leaseback of its multiplex property at Phoenix Mills Compound, Mumbai for over Rs 1 billion (Rs 100 crore). Infinite India is the investment manager for real estate funds sponsored by the JM Financial Group.

The seven screen multiplex property at Phoenix Mills, Lower Parel, Mumbai is one of the premier flagship properties of PVR and is amongst the highest grossing multiplexes in India.

Under the arrangement, JM Financial Group, on behalf of its newly launched JM Financial Real Estate Income Fund, managed by Infinite India, has agreed to purchase the share capital of CR Retail Malls (India), the wholly owned subsidiary of PVR that owns the multiplex at Phoenix Mills. PVR shall receive a sum of Rs 1 billion  pursuant to the transaction, in the form of refund of existing loans made to CR Retail and consideration against sale of equity shares of CR Retail.

Post completion of the transaction, PVR will continue to operate the multiplex property on a long term lease arrangement basis.

PVR Limited chairman and managing director Ajay Bijli said, “We are delighted to partner with Infinite. The sale and lease back transaction unlocks capital for investment into future projects providing a significant impetus to our expansion plans. The transaction also improves the overall return on capital employed and further solidifies our positive outlook on our core business of operating and managing multiplex properties across the country on a long term leasebasis.”

JM Financial Group’s Vishal Kampani added, “We are very pleased to acquire one of Mumbai’s high quality real estate asset located in the prime retail destination, High Street Phoenix and have PVR as our high quality tenant given their successful track record and business profile. This transaction demonstrates our ability to help owners of strategically located, single or multiple tenanted properties, to optimize their capital efficiency and unlock shareholder value. Infinite India is excited about this transaction and is committed to purchasing additional leased income generating assets for our newly launched JM Financial Real Estate Income Fund. We intend to distribute the rental yields of the leased properties to investors coupled with an opportunity for investors to share in the capital appreciation of some of India’s class A assets.”