Financial creditors of debt-ridden Jaypee Infratech, including banks and homebuyers, will meet again on April 29 to hold discussions on the revised resolution plans submitted by the government’s construction arm NBCC and Suraksha group to take over the embattled realty firm through an insolvency process.
The case involves more than 20,000 homebuyers who have been anxiously waiting for the completion of their homes for over a decade.
The revised resolution plans with further changes are expected to be submitted by both the entities with the insolvency resolution professional Anuj Jain by April 28, sources told Moneycontrol.
NBCC is expected to provide details of the 1,526 acres of land in the revised plan that it is likely to submit by April 28, sources said.
The financial creditors are expected to discuss the two plans and continue with negotiations with the two resolution applications at the meeting to be held on April 29. The plans will then be put to vote, sources said.
In a regulatory filing, Jaypee Infratech informed that a meeting of the Committee of Creditors (CoC) will be held on April 29, 2021. “Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (LODR) and in accordance with the requirements of sub-clause 16(g) of Clause A of Part A of Schedule III of LODR, we wish to inform you that a meeting of Committee of Creditors will be held on 29th April 2021,” the embattled firm said.
In the last meeting of the CoC held on April 17, lenders had asked NBCC and Suraksha group to improve their bid and offer more land parcels under the land-debt swap deal. They had also asked the bidders to specify the treatment of dissenting financial creditors, sources had said.
This is the fourth round of the corporate insolvency resolution process.
Jaypee Infratech case | NBCC and Suraksha Realty submit revised resolution plans
Earlier this month, NBCC and Mumbai-based Suraksha group submitted their revised bids to acquire Jaypee Infratech through an insolvency process, as per the direction of the Supreme Court. In their bids, NBCC has offered 1,526-acre land and Suraksha group around 2,040 acres to lenders.
Sources also said that both NBCC and Suraksha have carried out some changes in their revised plans following the apex court order to return Rs 750 crore with accrued interest to Jaiprakash Associates (JAL) after reconciliation of accounts between JAL and JIL.
On Yamuna Expressway, NBCC has proposed to offer 82 percent equity in the road asset to lenders and it will retain an 18 percent share. In the 2019 bid, it had proposed a 100 percent transfer of highway.
The issue of dissenting financial creditors has also been looked into, they said.
The two firms had submitted revised bids following the Supreme Court’s order on March 24 which said the IRP can invite modified or fresh resolution plans only from Suraksha Realty and state-run NBCC.
NBCC seeks one-month extension from SC to submit revised resolution plan for Jaypee Infra
In a judgment delivered on March 24, the apex court said the Insolvency Resolution Professional (IRP) can invite modified or fresh resolution plans only from Suraksha Realty and state-run NBCC, the two applicants who were allowed to do so in the judgment on November 6, 2019. It said the resolution plans should be submitted in two weeks.
The apex court had also said that Rs 750 crore deposited by Jaypee Associates would not go to Jaypee Infratech and that NBCC would not be allowed to utilise it for construction.
The Supreme Court's judgment on March 24, 2021, allowing another 45 days for insolvency resolution had evoked mixed reactions ranging from aggrieved homebuyers and their lawyers expressing frustration to some legal experts lauding the verdict as the best possible outcome that gives clarity on extremely complicated matters.
Jaypee Infratech insolvency case: Supreme Court sets 45-day deadline for resolution
In November 2019, the top court had directed the completion of Jaypee Infratech's insolvency process within 90 days and the revised resolution plan to be invited only from the NBCC and Suraksha Realty.
The December 2019 round of voting was the third round of the bidding process to find a buyer for Jaypee Infratech, which went into the Corporate Insolvency Resolution Process (CIRP) in August 2017.
NBCC had then proposed to complete over 20,000 pending flats in housing projects launched by Jaypee Infratech in Noida and Greater Noida (Uttar Pradesh). Homebuyers' claims amounting to Rs 13,364 crore and lenders' claims worth Rs 9,783 crore were admitted.
In its bid in December 2019, NBCC had offered 1,526 acres of land to lenders under a land-debt swap deal. On Yamuna Expressway, NBCC has proposed to transfer the road asset to lenders but before that, it would take a loan of around Rs 2,500 crore against toll revenue to fund construction spend.
Jaypee Infratech case: Homebuyers fret but legal experts applaud Supreme Court verdict
More than 10,000 homebuyers and major lenders of Jaypee Infratech, including IDBI Bank and State Bank of India, had voted in favour of the resolution plan submitted by the government's construction arm NBCC to acquire the embattled real estate firm. The CoC comprising 13 banks and around 21,000 homebuyers, approved the resolution plan of NBCC with a 97.36 percent vote in favour in the third round of the bidding process.
In the same round, Mumbai-based Suraksha Realty had improved its bid to acquire Jaypee Infratech by offering more land and upfront cash to lenders. It had increased its upfront payment to lenders to Rs 190 crore from Rs 175 crore, while size of the land-debt swap improved to 2,275 acres from 2,220 acres in its final bid submitted on December 3.