Leela Palaces Hotels & Resorts has announced a landmark acquisition of an ultra-luxury resort in Coorg, Karnataka, marking a significant expansion into nature-led hospitality. The company's wholly owned subsidiary, Leela Luxe Hotels & Resorts Private Limited (LLHRPL), acquired the luxury resort business for an aggregate consideration of up to ₹560 crores through a slump sale mechanism on a going concern basis.

Resort Specifications and Rebranding

The acquired property will be unveiled as The Leela Coorg Forest Sanctuary later this year, representing the brand's first Sanctuary concept. The resort features 71 all-villa accommodations spread across 76 acres of lush landscape near Madikeri, surrounded by coffee and spice plantations in the Western Ghats.

Transaction Structure and Parties

The business transfer agreement was executed between LLHRPL and Pai Vista Hotels Private Limited, along with its promoters including Mr. Jagannath Pai, Ms. Shantha Pai, Mr. Ajay Pai, Ms. Sangeetha Pai, Mr. Sujay Pai, and Ms. Sahana Pai. Additional transaction documents were signed with Timbertales Hotels & Resorts and Ms. Shilpa Pai for acquiring supplementary land parcels and assets.

Resort Amenities and Facilities

The ultra-luxury resort offers comprehensive amenities designed for immersive wellness and nature experiences. The property features a 27,000 sq. ft. wellness centre with 25 treatment rooms offering diverse therapies, gym, sauna, swimming pool and yoga deck. Additional facilities include four dining venues spanning global and regional cuisines, bean-to-cup coffee experiences, a 7-acre private lake, entertainment arena, and a private helipad for seamless access.

Expansion and Revenue Projections

The acquisition includes significant expansion potential with Phase I adding 19 villas to bring total inventory to 90 villas. The resort is expected to generate stabilized revenue of ₹165.00-₹175.00 crores with a margin profile similar to Leela properties at 50%+. The property benefits from proximity to Bengaluru and Mangaluru, positioning it as a key drive-to leisure destination.

Strategic Positioning

According to Mr. Anuraag Bhatnagar, Chief Executive Officer, this acquisition coincides with The Leela's 40th anniversary and represents the brand's evolution into nature-immersive, wellness-focused hospitality. The transaction strengthens The Leela's presence in South India while advancing its strategy of building a balanced portfolio across India's most iconic landscapes.

The acquisition was disclosed under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, with the company confirming no related party transactions or potential conflicts of interest.

Leela palaces hotels & resorts Limited has received approval for a substantial investment of ₹231.2 crores in its wholly owned subsidiary, marking a significant capital allocation decision in the hospitality sector. The Capital Investment Committee of the Board of Directors approved this strategic investment on March 16, 2026.

Investment Structure

The investment involves a rights issue by Leela Luxe Hotels & Resorts Private Limited (LLHRPL), with the parent company subscribing to 2.31 crore equity shares. The shares are priced at ₹100 per equity share, which includes a premium of ₹90 per share above the face value of ₹10.

Subsidiary Profile

LLHRPL operates in the hospitality industry and was incorporated on November 28, 2025. As a recently incorporated entity, it does not have historical financial records for the past three years. The subsidiary currently has a paid-up share capital of ₹5,00,000 and operates within India.

Investment Objectives

The capital infusion is intended to support multiple strategic initiatives for LLHRPL, including strategic acquisitions and business development, property expansion and new development projects, refurbishment of existing facilities, capital expenditure requirements, working capital needs, and general corporate purposes.

Regulatory Compliance

While LLHRPL qualifies as a related party under SEBI regulations due to its wholly owned subsidiary status, this transaction is exempted from related party transaction requirements as it involves a rights issue. The investment maintains the existing shareholding structure, with Leela Palaces Hotels & Resorts continuing to hold 100% ownership of LLHRPL. The transaction is expected to be completed in March 2026 and does not require any governmental or regulatory approvals.