The founders of Indian property developer DLF Limited late Tuesday sold a 9.9% stake in the company through a placement, raising Rs38.64 billion $783 million. However, this wasn't a simple case of the majority owners trying to secure a profit, or taking some of their investments of the table. Rather, they will reinvest part of the money into DLF through a wholly-owned venture and use the rest to buy the convertible preference shares held by a third party in that same venture.
The reuse of the proceeds likely explains why the market's reaction to the placement was initially positive, with the share price up as much as 7.9% in early trading. However, negative sentiment...
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