Mahindra Holidays and Resorts has called off the purchase of a 5-star resort located in the hill town of Lonavala over uncertainty in the business environment for hotels post the Covid 19 outbreak, according to people aware of the matter.
The Anand Mahindra group company which runs hotels and resorts under the Club Mahindra brand was in advanced discussions for the purchase of the resort that is operated by Novotel and owned by the Imagicaaworld group.
“The resort gets substantial bookings from visitors to the Imagicaa world amusement park that is situated near it. In the current scenario with lockdowns in force it is difficult to predict when such public entertainment destinations will return to doing normal business”, one person aware of the development said.
“We don’t comment on any speculation”, a Mahindra group spokesperson said in an emailed response to ET’s queries.
"As part of the Debt Settlement process, we are in active conversations for assets sale with couple of leading players. However, we are unable to comment on any specific company's interest in any of our assets" Imagicaaworld’s joint chief executive officer Dhimant Bakshi said.
The resort carries a price tag of Rs. 250 crores. Dmart’s promoter Radhakishan Damani has been amongst suitors for the property and came close to clinching a deal for its purchase, ET had reported in its edition on 23 November 2017.
Imagicaa world was previously known as Adlabs Entertainment before the company underwent a change of name in February.
BCCL, the publisher of The Economic Times, owns a 1.4% stake in Imagicaaworld as per latest available stock exchange disclosures.
For the financial year 2018- 2019, Mahindra Holidays & Resorts reported revenues of Rs 963 crore and a net profit of Rs 63 crore. In a tweet, Mahindra Group chairman Anand Mahindra also offered to provide Club Mahindra Resorts as temporary care facilities last month.
“This pandemic is likely to see the exit of some hotel companies and the restructuring of several others globally”, Mandeep Lamba, president, South Asia, at hospitality consultancy HVS Anarock said.
“Closer home in India, it will be no different”.
April 10, 2020