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Clearwater Capital Sells Stake In Kamat Hotels At 223% Loss

Clearwater Capital Partners (Cyprus) Ltd. sold a significant stake in Kamat Hotels (India) Ltd. at a loss of more than 223 percent, according to BloombergQuint’s calculations.

In the last four trading days, Clearwater Capital sold nearly 17.04 percent stake in Kamat Hotels for an average price of Rs 41.7 per share. It had acquired the stake by converting its foreign currency convertible bonds (FCCB) in 2012 at a pre-decided price of Rs 135 per share.

Clearwater Capital and Kamat Hotels didn’t respond to BloombergQuint emails seeking reasons for the stake sale. Its holding will come down to 3.72 percent after the stake sale.

Clearwater had subscribed to the FCCBs in 2007 for $18 million. The rights that Clearwater got in Kamat Hotels as a consequence of this investment had raised questions of ‘control’ by market regulator Securities Exchange Board of India (SEBI).

Shares of Kamat Hotels have run up over 50 percent year to date after the company reported a net profit of Rs 29.7 crore in the third quarter of financial year 2016-17, following two straight quarters of net losses. Since the financial year 2011-12, the company has reported a profit only in seven out of 23 quarters.