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NBCC asks court-appointed insolvency resolution professional to reconsider its bid

In a regulatory filing, NBCC said it has got the necessary approvals from the Ministry of Housing and Urban Affairs and other concerned departments for its bid.

Vandana Ramnani @vandanaramnani1
 
 
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The government’s construction arm NBCC, which has received the go-ahead from all government departments for its revised offer to acquire the embattled Jaypee Infratech, has now written to the court-appointed insolvency resolution professional to reconsider its bid.

In a letter to the appointed interim resolution professional (IRP) Anuj Jain, on May 1, NBCC said, "All necessary administrative approvals have been obtained by us.... We would request you to reconsider your decision and put up our plan for voting before the CoC".

''Please note that we shall take all steps, as may be necessary to protect our interest and the interest of the creditors of the Jaypee Infratech including the homebuyers,'' the letter said.

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In a regulatory filing, NBCC said it has got the necessary approvals from the Ministry of Housing and Urban Affairs and other concerned departments for its bid.

During the CoC meeting on April 26, NBCC had sought some time to take all the necessary approvals but the lenders decided to put on vote on April 30 the offer of Suraksha Realty-led consortium and not NBCC's.

After the COC meeting, NBCC had also written a letter to the interim resolution professional (IRP) Anuj Jain expressing its interest in taking over the embattled firm and that its offer should be considered on merit.

NBCC continues to be very interested in the resolution process and accord the interest of the homebuyers, utmost priority, the letter written by NBCC to the IRP said.

"It is to bring to your attention that during the CoC meeting on 26th April it was clarified by NBCC that these approvals have been applied as expected shortly and it was requested to consider some time frame for allowing NBCC to obtain the approvals before the actual voting on the plan.

“This appeal was made on basis of the fact that the CoC meeting was being held on 26th April, just 2 days after the submission of plan on 24th, and there was not enough time to inform the CoC regarding the status of Govt approvals. We are confident that our proposal will safeguard the interest of the home buyers and the lenders. Therefore, we request the CoC to consider our proposal on merit," the letter written by NBCC to the IRP had said.

Meanwhile, financial creditors and home-buyers of the Jaypee group realty firm are currently voting on the bid of Suraksha Realty, the lone player left in the race to acquire the company. The voting process started on Tuesday (April 30) and would conclude on May 3.

Meanwhile, representatives of nine homebuyers' associations of Jaypee Infratech's housing projects in Noida, Uttar Pradesh, alleged that Jaypee group promoters are interfering in the insolvency proceedings to regain control over the troubled realty firm and that the voting process is not being carried out in a fair manner.

"Our demand is that an emergency meeting of the committee of creditors (CoC) be called immediately. NBCC being a government agency should be given a chance in the voting process because homebuyers now don't have any faith in private players," homebuyers told reporters at a press conference held in Noida.

"There is no credibility left with the Jaypee group. Now they say they want to complete the project but there is no point believing them. The only hope now is if NBCC gets to participate in the voting," they said.

Gujarat-based conglomerate Adani Group has also expressed interest in bidding for the realty firm, which has been in financial trouble after defaulting on loans but has a huge portfolio of housing projects and land parcels worth thousands of crores in the national capital region.

On April 30, debt-ridden Jaypee Infratech's lead lender IDBI approached the National Company Law Tribunal (NCLT) seeking extension of insolvency proceedings beyond the May 6 deadline as the process to find a buyer for the Jaypee group's realty firm is still underway.

The bank has approached the Allahabad bench of the NCLT court to extend the Corporate Insolvency Resolution Process (CIRP) as the deadline expires on May 6, sources said.

The NCLT will hear the matter now on May 6.

In its previous bid, NBCC had offered 1400 acres of land worth Rs 6000 crore and equity infusion of Rs 500 crore upfront. In the revised bid, it has offered 950 acres of land worth Rs 5001 crore and reduced the equity infusion from  Rs 500 crore to Rs 200 crore, sources said.

For secured financial creditors, it has offered a payment of upfront amount of Rs 1,500 crore, 100 percent in Yamuna Expressway SPV, 100 percent in land bank SPV. The land bank SPV is worth Rs 5001 crore and totals 950 acres

Suraksha had earlier offered about Rs 20 crore as upfront payment but in the revised bid, it has proposed an equity infusion of Rs 50 crore and a working capital loan of Rs 3000 crore against a requirement of Rs 2,404 crore to complete construction work, sources said, adding their completion timelines are on an average one year less than NBCC.

A few days ago, Manoj Gaur, promoter of Jaypee Infratech, had once again offered to complete the much-delayed real estate projects within a period of four year by pumping in Rs 1,500 crore in an escrow account. Gaur during the meeting with homebuyers claimed that he was a 'victim of circumstances', made a presentation and proposed that Rs 1,500 crore would be set aside in an escrow account for completion and construction of the projects that are proposed to be completed within four years.

As many as 22,000 homebuyers are stuck because of significant delay in delivery of flats by Jaypee group's debt-ridden firm Jaypee Infratech, which is undergoing insolvency proceedings.

In 2017, the National Company Law Tribunal (NCLT) admitted the application by an IDBI Bank-led consortium seeking resolution of Jaypee Infratech. In the first round of insolvency proceedings, the Rs 7,350 crore bid of Lakshdeep, part of Suraksha group, was rejected by lenders as it was found to be substantially lower than the company's net worth and assets.

In October 2018, the IRP started a fresh initiative to revive Jaypee Infratech on NCLT's direction.

The realty firm has an outstanding debt of nearly Rs 9,800 crore, of which Rs 4,334 crore pertains to IDBI Bank. Other lenders are IIFCL, LIC, SBI, Corporation Bank, Syndicate Bank, Bank Of Maharashtra, ICICI Bank, Union Bank, IFCI, J&K Bank, Axis Bank and Srei Equipment Finance.

Jaypee Infratech is developing about 32,000 flats, of which it has delivered 9,500 units. JAL had deposited Rs 750 crore in the registry of the Supreme Court for refund to buyers. However, this amount was transferred to the NCLT as per an order of the apex court.

 

vandana.ramnani@nw18.com

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First Published on May 2, 2019 12:28 pm
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