Le Royal Méridien’s PGP sells land to VGN for Rs 172 cr to pare debt
Confirming the development in an exclusive interaction with DT Next here on Tuesday, Periasamy said a fresh phase of growth is under way for the group that owns the iconic Le Royal Méridien in Guindy, the first international chain to be established in Chennai.
Palani G Periasamy
CHENNAI: In a strategic move to regain complete control of his hospitality assets, Appu Hotels owner and noted industrialist Palani G Periasamy has sold 26 acres of land at Girugambakkam near Chennai airport for Rs 172 crore to prominent developer VGN. The deal, finalised two months ago, has helped reduce a part of the group’s high-cost debt.
Confirming the development in an exclusive interaction with DT Next here on Tuesday, Periasamy said a fresh phase of growth is under way for the group that owns the iconic Le Royal Méridien in Guindy, the first international chain to be established in Chennai.
In 2023, it was Thyrocare promoter A Velumani who acted as a ‘white knight’ of sorts to bail out Periasamy, chairman of Appu Hotels Ltd (AHL), pare the Rs 420-odd crore debt after the octogenarian's hospitality venture hit financial hurdles and went into the National Company Law Tribunal framework.
Iheart Properties Private Ltd, the investment vehicle that Velumani floated after exiting Thyrocare, lent the sum against security (hotel plus freehold land), enabling Periasamy to settle his debts, enabling him to take on the legal battle with MGM Healthcare chairman MK Rajagopalan, who made a Rs 423-crore bid to take over Appu Hotels.
Two years on, Periasamy has partially repaid the loan. Confirming this to DT Next, Velumani said he has been receiving the 17 per cent interest for the balance amount.
As Le Royal Méridien Chennai marks its silver jubilee this year on December 30, Appu Hotels is set to renew its branding partnership with Marriott International through a 20-year agreement on Wednesday.
The iconic property would be renovated at a cost of Rs 100 crore, said Periasamy. “This investment is being raised through internal funds and debt,” he said, adding that the refurbishment would elevate the property’s positioning in the city’s premium hospitality segment.
Appu Hotels had earlier monetised certain non-core land parcels as part of its revival plan to overcome pandemic-induced pressures. With the Girugambakkam deal concluded and a major partnership renewal in hand, the diversified group is stepping into a more confident future, Periasamy said.