News: DLF hires McKinsey to improve biz practises
(TNN 16/05/2006) New Delhi - Real estate major DLF group has hired consultancy major McKinsey for effecting an organisational transformation in work culture and business practices. It has also restructured its board by inducting four independent directors, in the process expanding the number of board members from six to 12, with 50% being independent directors.
At the same time, ex-Standard Chartered Bank boss, and KP Singh’s son-in-law, Rana Talwar, has also joined the board of directors at DLF. As part of effort to strengthen its management team, the group has inducted around 200 heads at mid-management to senior management levels across the country over the last six months.
The four newly-appointed independent directors include ex-chairman Reliance Power Dr DV Kapur, ex-Bata India chairman MM Sabharwal, noted financial analyst KN Memani and legal expert Ravinder Narain. This is part of the group’s effort to effect a transformation in its work culture, bring in more transparency in its operations and be more responsive to shareholder and customer interests.
Speaking to ET, DLF vice-chairman Rajiv Singh said, for the 60-year old group, going public is not an end in itself, but beginning of a process to be able to operate on a global scale. “We see the potential to be a world-class company making most of the growth opportunities within the country,” Mr Singh said.
For that to happen it was important for the organisation to bring in more clarity of mindset at every level, starting from the promoter and top management level, Mr Singh said. The group has appointed McKinsey and Goldman Sachs as advisors to the company on strategic issues.
With Sebi barring pre-IPO placement by FIIs in real estate companies, the group is still evaluating whether to offer some equity to domestic institutional investors. It is expected to take a call on the issue over the next couple of days.
The group is in the process of raising over Rs 13,600 cr from the capital market. On its foray into the hospitality sector, Mr Singh said the group will be present across budget, business and luxury segments of hotel and will enter into multiple partner relationships.
“We will only be a development company in the hotel space and currently are in talks with several prospective partners who will manage and run these properties,” he said.
According to Mr Singh, the India growth story is here to stay, with metros growing at around 20% against the nation’s 8%. “The demand for housing is a manifest of that growth,” he said.
Mr Singh is of the view that the current prices in real estate were not unsustainable, as demand outstrips supply in retail, residential and commercial spaces.
For him “bubble” is harsh word to use for explaining the recent escalation in realty prices. “I don’t think that the real estate market is speculative. However there will be stabilisation and moderation in rates over time,” he added.
At the same time, ex-Standard Chartered Bank boss, and KP Singh’s son-in-law, Rana Talwar, has also joined the board of directors at DLF. As part of effort to strengthen its management team, the group has inducted around 200 heads at mid-management to senior management levels across the country over the last six months.
The four newly-appointed independent directors include ex-chairman Reliance Power Dr DV Kapur, ex-Bata India chairman MM Sabharwal, noted financial analyst KN Memani and legal expert Ravinder Narain. This is part of the group’s effort to effect a transformation in its work culture, bring in more transparency in its operations and be more responsive to shareholder and customer interests.
Speaking to ET, DLF vice-chairman Rajiv Singh said, for the 60-year old group, going public is not an end in itself, but beginning of a process to be able to operate on a global scale. “We see the potential to be a world-class company making most of the growth opportunities within the country,” Mr Singh said.
For that to happen it was important for the organisation to bring in more clarity of mindset at every level, starting from the promoter and top management level, Mr Singh said. The group has appointed McKinsey and Goldman Sachs as advisors to the company on strategic issues.
With Sebi barring pre-IPO placement by FIIs in real estate companies, the group is still evaluating whether to offer some equity to domestic institutional investors. It is expected to take a call on the issue over the next couple of days.
The group is in the process of raising over Rs 13,600 cr from the capital market. On its foray into the hospitality sector, Mr Singh said the group will be present across budget, business and luxury segments of hotel and will enter into multiple partner relationships.
“We will only be a development company in the hotel space and currently are in talks with several prospective partners who will manage and run these properties,” he said.
According to Mr Singh, the India growth story is here to stay, with metros growing at around 20% against the nation’s 8%. “The demand for housing is a manifest of that growth,” he said.
Mr Singh is of the view that the current prices in real estate were not unsustainable, as demand outstrips supply in retail, residential and commercial spaces.
For him “bubble” is harsh word to use for explaining the recent escalation in realty prices. “I don’t think that the real estate market is speculative. However there will be stabilisation and moderation in rates over time,” he added.
posted by InCar Group Press Room at 14:14
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