Deutsche Bank is set to invest $125 million in Bangalore-based Golden Gate Properties (GGPL) for around 15-20 percent stake.
According to the sources, the initial agreement has been signed, though the deal is not yet closed. Other funds in the final fray included Credit Suisse and ABN Amro.
The transaction is likely to value GGPL at around Rs 2,700-3,000 crore, says the sources. The company that has sizeable land bank in Bangalore is still ranked among the tier-II real estate developers. Currently, the company has seven ongoing projects worth Rs 1,500 crore. GGPL's top management was unavailable for comment.
The impending transaction will be Deutsche Bank's first entity-level investment in the Indian real estate sector. Its two other significant investments were into specific FDI-complaint projects. It recently infused Rs 500 crore for a 5 percent stake in Hindustan Construction Company's Lavasa project near Pune. The deal valued Lavasa Corporation at Rs 10,000 crore.
Earlier, DB invested around Rs 1,700 crore for around 25 percent stake in special purpose vehicle (SPV) floated by Mumbai-based Lodha Group. This SPV proposes to set up three FDI compliant real estate projects over 70 acres in Thane and Dahisar.
Not withstanding the ballooning subprime crisis in the US market, DB and its global peers like JP Morgan, Credit Suisse and ABN Amro are on prowl for investments in India's real estate sector.