The Hindu : Tamil Nadu / Chennai News : Theatre complex auctioned for Rs.80 crore

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Friday, May 01, 2009
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Tamil Nadu

Tamil Nadu - Chennai

Theatre complex auctioned for Rs.80 crore

A.Srivathsan

For last two and half years, it was under the administration of High Court-appointed receiver

Photo: R.Shivaji Rao

Changing hands: The Udhayam theatre complex in Ashok Nagar. —

CHENNAI: The e-auction of Udhayam theatre complex in Ashok Nagar found a successful bidder on Thursday. This 1.31-acre property was sold for Rs.80 crore. “This is one of the high value transactions in the recent times and comes amid the relatively stagnant real estate market,” said S. Venkatakrishnan of the Land Department of the Jones Lang LaSalle Meghraj, Chennai.

Udhayam Theatre complex was built in 1983 and has 53 share holders. While the major sharer holders sought to sell the property, the minor share holders were reluctant. For the last two and half years, the theatre has been under the administration of the High Court-appointed receiver. In the meanwhile, the court appointed Jones Lang LaSalle Meghraj, real estate consultants, to facilitate the auctioning of the property.

An e-auction was announced in March. The base price of the property then was fixed at Rs.100 crore and bids were invited. There were hardly any bidders except a lone expression of interest and an offer Rs.100 crore was made. However, this offer was not followed with the mandatory payment of Earnest Money Deposit (EMD) of Rs.25 lakh.

“We had to reduce the base price to Rs.29 crore based on the guideline value of the property and go for a fresh auction”, said Mr.Venkatakrishnan. “This time we had six bidders who had paid the required deposits. The e-auction took place on Wednesday between 2 pm and 5 pm and the process was overseen by the court-appointed commissioner. The two highest bidders were called for a meeting on Thursday and the bidding continued between them. Eventually, S.Paramasivam Pillai emerged successful with his Rs.80 crore-offer”, explained Mr.Venkatakrishnan

Mr. Pillai is one of the existing share holders of the Udhayam theatre complex. The unsuccessful bidders include a film distributor, a theatre owner, a textile businessman and two Non-Resident Indians. Twenty per cent of Rs. 80 crore will have to be paid by May 14 as the first instalment and the balance by May 31. Mr. Venkatakrishnan said, “the share holders of the Udhayam Theatre complex are satisfied with the price and the High court appointed commissioner has approved it.” In the last two and half years, the theatre has been fetching average revenue of about Rs.60 lakh a month.

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