Lenders, Jaypee Homebuyer Representatives Meet To Discuss Interim Solution
The insolvency resolution professional for Jaypee Infratech kick-started the first round of meetings with financial creditors and home buyers this week.
Financial creditors and representative of homebuyers met with the interim resolution professional (IRP) for Jaypee Infratech Ltd. on Tuesday to kick off discussions on a resolution plan, two people aware of the matter told BloombergQuint on condition of anonymity. This was the first meeting between the committee of creditors and the IRP after the case was admitted for insolvency proceedings on August 9.
According to the first of the two people quoted above, the IRP, Anuj Jain, sought clarity on whether lenders would continue to fund the company’s existing real estate projects. Alternatively, would lenders be looking to simply sell the company’s undeveloped land parcels to recover their money, Jain asked.
The IRP’s demand for interim funding would be based on the view that lenders take, the first person said.
Representatives of homebuyers and fixed deposit holders, who were asked to be part of the meeting of committee of creditors as per an order by the Supreme Court, asked the IRP and financial creditors to consider their dues and needs before approving any resolution plan for the company.
Jain didn’t respond to an email query sent on Wednesday. An email sent to Jaypee Infratech did not elicit a response.
The Jaypee Infratech insolvency proceedings faced delays after the Supreme Court intervened in the matter, following a plea from home buyers who have paid for houses in Jaypee Wish Town, a residential complex being developed in Noida. The apex court had temporarily stayed the insolvency proceeding earlier this month. However, this was revoked on September 12 and the IRP was asked to come up with a resolution plan within 45 days. The IRP was asked to ensure that concerns of home buyers were addressed in the resolution plan.
The Supreme Court also asked Jaypee Infratech’s parent company, Jaiprakash Associates Ltd., to deposit Rs 2,000 crore to cover for the liabilities of homebuyers. Jaypee Infratech owes its lenders nearly Rs 9,500 crore according to the annual report for financial year 2015-16.
(Updates an earlier version to correct Anuj Jain’s designation in the fifth para)