Shares of Indiabulls Real Estate surged over 13 percent after the company said that it will sell its London property to promoters for approximately Rs 1,800 crore.

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"Company has decided to focus only on Mumbai and NCR markets and hence has decided to divest Century Limited, the parent company that houses Hanover Square property, London. In light of continuing Brexit related issues and uncertainty around it, the London property market remains sluggish so the promoter has undertaken to buy the parent company of London asset for

200 million pounds," it said in a regulatory filing.

Indiabulls Real Estate shares rose as much as 13.4 percent to hit the day's high of Rs 119.7 per share on BSE. At 12:50 pm, the stock was trading at Rs 117.3, up 11 percent as compared to a 0.24 percent rise in the benchmark Sensex.

The sale is a part of its strategy to focus on its India business and cut debt. The company's net debt, which stood at Rs 4,590 crore at the end of the Q4 FY19 would be reduced to Rs 3,000 crore after this transaction.

The company had purchased this property for 161.5 million pounds, it said, and the current valuation has been pegged at 189 million pounds.

Meanwhile, according to news reports, Indiabulls Group is also likely to have approached its joint venture partner Blackstone and other realty firms such as Godrej Properties to offload its stake in Indiabulls Real Estate.

The move to exit Indiabulls Real Estate is aimed at improving chances of regulatory nod for the proposed merger of Indiabulls Housing Finance with Lakshmi Vilas Bank (LVB), said the report citing a person familiar with the strategy.

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First Published:Apr 24, 2019 1:12 PM IST