NCLT Approves NBCC’s Bid To Acquire Jaypee Infratech But With Modifications
The tribunal, however, modified the resolution plan, saying the Rs 750 crore deposited by Jaiprakash Associates—parent of the debt-laden real estate developer—in the Supreme Court will be part of the plan, among others.
The tribunal also ordered that the dissenting financial creditor ICICI Bank should be paid equal to the amount which it would have received in the event of liquidation of the company and the interest on this amount must be paid to the bank. The NCLT granted the liberty for this payment to be made in 12 installments. The bench modified the resolution plan to the extent that it provided for land and equity as payment to ICICI Bank’s claim.
The state-owned company’s resolution plan had initially proposed to complete the under-construction housing projects of Jaypee Infratech in three and a half years and repay institutional financial creditors in full. In January, NBCC had won 97.36 percent of the votes of the committee of creditors. The other bid on offer was by Suraksha Realty. Homebuyers, according to regulatory disclosures, constituted nearly 57.8 percent of the vote in the committee of creditors and the winning bid needed at least 66 percent of the votes.
Jaypee Infratech had left homebuyers—whose claims amount to more than Rs 13,000 crore—in the lurch as it struggled to complete houses. The company also owes about Rs 9,800 crore to lenders. That prompted the Reserve Bank of India to include it in the first 12 large corporate accounts referred for resolution under the Insolvency and Bankruptcy Code in June 2017. Jaypee Infratech went into insolvency in August 2017 after the NCLT admitted an application by an IDBI Bank Ltd.-led consortium.
After a failed resolution in the first 270-day deadline, the Supreme Court intervened to prevent liquidation in the interest of homebuyers and ordered fresh bidding twice. On Nov. 6, the apex court directed the committee of creditors to consider bids only from NBCC and Suraksha Realty and complete the insolvency process within 90 days.