According to the report, the two partners will invest together USD 500 million in 50:50 Joint Venture that will specialise in debt and structured finance and may kick-start operations from next year.
The venture may not provide equity funding to the realty sector, thanks to the poor corporate governance. Financiers, especially for the realty sector, prefer debt exposures like investments in listed non-convertible debentures, debts with equity kickers, junior debt with a second charge on the collateral, and even plain-vanilla loans against land and cash flow from properties, said ET report.
Piramal Group has been focusing on the realty sector after it sold its domestic formulations business for USD 3.7 billion in 2010. Its real estate private equity arm manages a total corpus of Rs 4,343 crore across five funds and two third-party mandates.
Dion Global Solutions Ltd.