Phoenix Mills to acquire CPP Investments' 49% in Island Star JV for Rs 5,449 Crore
Phoenix Mills Ltd
(PML) will acquire the 49% stake held by Canada Pension Plan Investment Board (
CPP Investments
) in their joint venture Island Star Mall Developers Pvt Ltd (ISMDPL), for over Rs 5,449 crore
The total consideration payable to CPP Investments will be paid over a 36-month period in four tranches. With this transaction, Phoenix Mills' ownership in ISMDPL will increase from 51% to 100% making it a wholly owned subsidiary of the company.
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The structure of the deal includes a mix of buyback, capital reduction, dividend payout by ISMDPL, and/or a secondary share purchase by
Phoenix Mills
or its affiliates. The amount may be adjusted in case of prepayment of any tranche.
'ISMDPL marked the beginning of our long-standing partnership with CPP Investments. What started with a single asset has grown into a portfolio across key urban centres. As we consolidate our stake, we remain focused on building on this foundation. We appreciate CPP Investments' role in shaping this platform and look forward to continuing our partnership through other ventures,' said Atul Ruia, Chairman of Phoenix Mills.
ISMDPL, which was formed in partnership between Phoenix Mills and CPP Investments, owns and operates a portfolio of
retail-led mixed-use assets
in key Indian cities. The platform currently has 4.4 million sq ft of operational retail space, which generated over Rs 617 crore in operating profit in 2024–25, primarily from the four operational malls.
'This transaction allows us to consolidate full ownership of a portfolio of high-quality, retail-led mixed-use assets across key Indian cities,' said Shishir Shrivastava, MD, Phoenix Mills. 'ISMDPL has grown into a strong platform with scale, stability, and clear visibility for future growth. Over the next few years, this platform will include over 5.2 million sq. ft of retail, around 4 million sq. ft of office space, and 2 to 3 hotels with approximately 1,000 keys.'
According to Shrivastava, the platform already owns the land and development rights required to deliver this plan. A completed office portfolio of 2.2 million sq ft in Pune and Bengaluru is expected to start contributing from 2025–26. Additional phases including second-phase retail and office development, as well as the Grand Hyatt hotel in Bengaluru, are expected to become operational between 2026 and 2027. These additions are expected to contribute to sustained operating profit and cash flows, while maintaining a healthy leverage profile.
These ongoing joint ventures include Mindstone Mall Developers, which is developing the Phoenix Grand Victoria in Kolkata, and Plutocrat Commercial Real Estate, which is behind Project Rise, an office-led development in Mumbai's Lower Parel.
Phoenix Mills said it intends to explore future opportunities with CPP Investments through these continuing partnerships.
Apart from its completed and under development assets, ISMDPL also holds balance floor space index potential across its existing hubs in Bengaluru, Pune, and Indore, which can be developed in phases and present the opportunity to monetize through future partnerships.
The transaction is expected to be earnings-accretive and capital-efficient from the first year itself. It is expected to be largely funded through internal accruals and incremental leverage at ISMDPL.
This acquisition enables Phoenix Mills to consolidate the cash flows, preserve liquidity at the Group level and continue executing on its broader stated growth plans without any material impact on its balance sheet strength.
The deal also allows for efficient cash utilisation and upstreaming to Phoenix Mills. Further, it also provides optionality to Phoenix Mills to explore future platform monetisation at underlying asset SPVs, at its discretion.
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