Sterling & Wilson Renewable Energy Ltd (S&W) has lodged complaints with the Securities and Exchange Board of India (SEBI) against Embassy Office Parks REIT and WeWork India, alleging non-disclosure of material information to investors. The complaints, filed on July 22, 2025, pertain to a ₹100 crore payment dispute related to a solar project involving Embassy Energy Pvt Ltd (EEPL), a unit of Embassy REIT.
The core of the issue stems from a 100-MW solar plant constructed by S&W in Karnataka, which is currently operated by EEPL. S&W alleges that WeWork India failed to disclose a chargesheet filed by the Economic Offences Wing in 2023 against Embassy Group promoters Jitendra and Karan Virwani, who also lead WeWork India, in its draft red herring prospectus for its initial public offering (IPO) earlier this year. WeWork India received SEBI approval for its IPO, which involves the sale of up to 43.7 million shares. Existing shareholders will receive all proceeds, as the listing does not include a fresh issue of shares. Embassy Buildcon, the promoter, plans to sell 33.4 million shares, while 1 Ariel Way Tenant, linked to the global WeWork group, will offload 10.
In a separate complaint to SEBI on April 3, S&W argued that the ongoing investigation against the Virwanis should disqualify them from holding positions in Embassy REIT under the "fit and proper person" criteria. Jitendra Virwani is the non-executive chair of Embassy Office Parks REIT, while Karan Virwani serves as a director on the boards of the REIT's sponsor and manager entities.
Non-disclosure of material information, especially information that could significantly influence the company's securities or investor decisions, is a violation of SEBI regulations. Such omissions can compromise the decision-making process for unit holders of REITs and potential IPO investors.
SEBI has previously emphasized the importance of the "fit and proper" criteria, which considers an individual's reputation, ethical behavior, and integrity. In November 2024, SEBI suspended Aravind Maiya, the CEO of Embassy Office Parks Management Services, the manager of Embassy REIT, for not meeting the "fit and proper" criteria. This action followed an order by the National Financial Reporting Authority (NFRA), which had examined the statutory auditors of Coffee Day Enterprises on their role in alleged financial irregularities at the company in 2018-19. Maiya was then the engagement partner at the statutory auditor for Coffee Day Enterprises. SEBI's order stated that Maiya's professional misconduct and gross negligence harmed ordinary investors.
Embassy REIT owns and operates a 51.1 million square feet portfolio and is India's first publicly listed REIT. WeWork India, backed by the Embassy Group, holds the exclusive license for the WeWork brand in India since 2017 and operates 94,440 desks across 59 centers spanning 6.48 million square feet as of September 30, 2024. As of the DRHP filing, Embassy Buildcon held a 73.82% stake.
S&W's promoters include Reliance New Energy Ltd (holding 32.5%), Shapoorji Pallonji And Co Pvt Ltd (6.94%) and the Daruvala family (6.3%).
