Billionaire Rakesh Jhunjhunwala and investor Radhakrishna Damani have invested around Rs 80 crore for a little over 14 per cent stake in Chennai-based Sterling Holiday Resorts India Ltd, founded by timesharing veteran R Subramanian in 1986. It may be noted, Private Equity firm Bay Capital Partners already infused around Rs 100 crore into the company.
Siddharth Mehta, chairman, Sterling Holiday Resorts India and Founder Bay Capital Partners confirmed the development at the company's Annual General Meeting on Wednesday.
Ramesh Ramanathan, managing director added that both the investors have picked up 14.2 per cent (7.1 per cent each) for an investment of Rs 40 crore each in the last two months.
Sterling Holiday's turnaround process began when private equity firm Bay Capital Partners Ltd invested in 2009 and R Subramanian, Sterlings’s chairman and managing director, ceded management control, following which Mehta taken over as Chairman of the company. According to Mehta so far Rs 100 crore has been pumped by him into the company.
“The company is on the verge of a turnaround and this year, we will report operating profit,” he said. “In the last one year, we have been clearing backup and other issues and now we are in the process of enhancing the quality of resorts and a new management has also been put,” said Mehta.
The company also has become a debt free company, added Ramanathan, who was earlier managing director, Mahindra Holidays. As part of refurbishment of properties the company is planning to invest around Rs 40 crore and also ooking at South East Asia, which will mark its foray outside India.
The company is also planning to add 300 rooms over the next 6-18 months, by leasing out properties to the existing 1258 invenotry. It may be noted, the company did not add any inventory for the past 12-13years.
“Once our properties are refurbished the focus would be acquiring new customers and to make in-active members to become active,” said Mehta, who is also the founder of Private Equity firm Bay Capital Partners, which invested around Rs 100 crore in Sterling Holidays. Mehta noted, if inactive members becomes active they would bring around Rs 100 crore worth of business for the company.
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