The Competition Commission of India (CCI) has cleared The Phoenix Mills Ltd’s proposal to acquire full ownership of Island Star Mall Developers Pvt Ltd (ISMDPL) in a deal valued at ₹5,450 crore. The move will see Phoenix Mills raise its stake from the existing 51% to 100%, as Canada Pension Plan Investment Board (CPP Investments) exits the joint venture.
The approval was confirmed by the CCI on August 19, following which Phoenix Mills notified the development through regulatory filings. The company stated that this acquisition strengthens its control over ISMDPL, which is primarily engaged in developing commercial and retail real estate in select urban markets.
Phoenix Mills and CPP Investments had entered into the joint venture arrangement several years ago to build large-scale retail and commercial projects in India. Phoenix Mills currently operates as a prominent developer of retail-led mixed-use assets, while CPP Investments provided capital partnership through its 49% shareholding in ISMDPL.
Under the new arrangement, CPP Investments will fully exit the venture, paving the way for Phoenix Mills to consolidate operations under one ownership. Market watchers see the acquisition as a strategic step for Phoenix Mills to expand its presence in retail real estate and streamline decision-making for ongoing and future projects.
The company is one of India’s largest retail mall developers and operators, with approximately 0.64 million square meters of operational retail space across nine malls in major cities including Mumbai, Pune, Bengaluru, Lucknow, Chennai and Bareilly.
Apart from its retail segment, Phoenix Mills has also diversified into commercial, residential, and hospitality assets, developing more than 2.11 million square meters of space across these categories. It is presently working on four malls under development, expected to add another 0.45 million square meters of retail area to its portfolio once completed.
ISMDPL’s business overlaps with Phoenix Mills’ core focus areas, as it also develops, designs, markets, and operates commercial and retail real estate projects. With both entities engaged in similar segments, the consolidation will bring operational synergies.
In its clearance note, the CCI observed that the acquirer (Phoenix Mills) and the target (ISMDPL) operate in the development, design, execution, marketing, operations and leasing of commercial and retail spaces, including malls, offices, hospitality, food and beverage assets, and residential property sales.
By allowing Phoenix Mills to take complete ownership, the competition regulator indicated that the deal does not raise concerns of market concentration or adverse effects on competition in the sector.
Following the announcement of CCI’s approval, Phoenix Mills’ shares gained in trade on August 20. the stock was trading at ₹1,512.20 on the National Stock Exchange, higher by 1.19% from the previous close. Analysts attribute the rise to investor confidence in the company’s strengthened growth prospects after securing full control over ISMDPL.
Phoenix Mills has been steadily consolidating its presence in India’s retail real estate sector, with significant investments in existing and new markets. Reports indicate that the company is planning to come up with a third mall in the Mumbai Metropolitan Region (MMR) at Thane and expand its Phoenix MarketCity Mall in Bengaluru.
Additionally, in August, Phoenix Mills’ subsidiary Casper Realty Pvt Ltd emerged as the highest bidder for two plots in Mohali, Punjab, with a winning bid of ₹891 crore. The move indicates the company’s continued focus on expanding into new geographies beyond its traditional markets.
The deal comes at a time when India’s retail real estate market is witnessing renewed investor interest after a period of subdued activity during the pandemic. With consumer footfalls recovering in malls and retailers expanding their store networks, developers are actively investing in new projects and consolidating existing ventures.
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