RPP Infra Projects Limited has submitted a regulatory disclosure to BSE Limited and National Stock Exchange of India Limited regarding its withdrawal from the "Legend 96" residential project in Sri Lanka.
The company had previously intimated the stock exchanges on 4th December 2024 about an in-principle agreement with Wills Realtors (Private) Limited for this project. Subsequently, the company's subsidiary, RPP Infra Projects (Lanka) Limited, entered into a Development and Financing Agreement with Wills Realtors on 28th January 2025. Under this agreement, RPP Infra was to participate as Joint Developer while Wills Realtors was the Primary Developer.
The project experienced significant delays primarily due to the time required for obtaining necessary regulatory, statutory, and building approvals in Sri Lanka. Additionally, arranging project financing through Indian banks proved challenging due to prevailing conditions in Sri Lanka, necessitating exploration of alternative local financing arrangements.
For the proposed local financing, it was contemplated that the project land would be offered as security/mortgage. However, the Primary Developer (Wills Realtors) was not willing to provide the project land as security. Furthermore, a proposal was made to alter/dilute the revenue-sharing arrangement agreed under the Development and Financing Agreement in the event that the project land was offered as security.
After considering these circumstances including approval delays, financing challenges, proposed security arrangements, and the proposed alteration to the revenue-sharing arrangement, the company determined that continuation of its participation was not commercially and financially feasible.
Accordingly, RPP Infra has decided to withdraw from and discontinue its participation as Joint Developer in the project. The company communicated this intention to Wills Realtors via letter dated 7th October 2026, seeking termination of the Development and Financing Agreement and settlement of amounts payable between the parties.
The company has incurred certain expenditure during the initial stages of the project, including assignment fees and other consideration relating to assignment/development rights. The company is currently in the process of recovering these amounts with Wills Realtors, and the parties propose to discuss and mutually agree upon the manner of settlement.
The withdrawal from the project is not expected to have any material adverse impact on the ongoing operations of the company.