Jaypee Infra Lenders Seek Clarity on NBCC’s Revised Bid, to take a call on Tuesday

Jaypee Infra Lenders Seek Clarity on NBCC’s Revised Bid, to take a call on Tuesday

The Committee of Creditors (CoC) met Thursday to discuss NBCC's revised offer after it rejected the bid of Mumbai-based Suraksha Realty on May 3 through a voting under the insolvency proceedings.

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MUMBAI: The Committee of Creditors (CoC) will take a final call on state-run NBCC’s revised bid for the beleaguered realty developer Jaypee Infratech on Tuesday after the bidder offers further clarity sought by lenders on its proposal, said two persons with direct knowledge of the development.

Financial creditors, in a meeting held today (Thursday), sought further clarity from NBCC over its revised bid.

“The queries are related to specific financing of the resolution proposal for the debt-hit Jaypee Infratech. Apart from this, the lenders are also seeking clarity on unsold inventory to be picked up the lenders, timing of monetization, price at which this inventory will be transferred to lenders, etc,” said one of the persons mentioned above.

While the CoC will send its specific queries to NBCC by Friday evening, the bidder is expected to submit its responses by Monday evening. These responses are expected to provide lenders clarity on the bid and enable a final decision in the next CoC meeting to be held on Tuesday.

Both Jaypee Infratech’s Insolvency Resolution Professional Anuj Jain and NBCC spokesperson declined to comment for the story.

Meanwhile, the Allahabad bench of NCLT has allowed debt-stressed realty developer JIL’s insolvency resolution process, which was scheduled to come to an end on May 6, to continue until May 21. This had paved way for the CoC to consider NBCC’s revised bid to acquire Jaypee Infratech at its meeting on Thursday.

If approved by lenders, both home buyers and creditors will vote on the proposal after that. However, whatever is the outcome; it will still depend on whether NCLT allows an extension to the insolvency process.

Financial creditors and home buyers have already voted against the bid of Mumbai-based Suraksha Realty, the only offer that was left in the race to acquire the company after lenders had rejected NBCC’s revised bid citing absence of approval from the government. Within a week of getting rejected by lenders of Jaypee Infratech, the state-run company received these approvals on May 1.

However, on May 1, NBCC’s revised bid received the government’s approval after a week of lenders of the realty developer rejected its offer citing lack of these approvals.

Apart from Suraksha and NBCC, Adani Group also showed interest in acquiring Jaypee Infratech. IDBI Bank, Jaypee Infratech’s lead lender, has approached the Allahabad bench of NCLT to seek this extension.

Earlier too, the NCLT had granted extension to the lenders and Interim Resolution Professional Anuj Jain to complete the Corporate Insolvency Resolution Process (CIRP). On January 28, the NCLT had extended the period of the CIRP by another 90 days as 180 days mandated under the Insolvency and Bankruptcy Code (IBC) was coming to an end on February 5, 2019.

Under the IBC, a resolution process has to be completed within 180 days with a further extension of 90 days to 270 days. As per the rules, if the company fails to complete the CIRP within the mandated 270 days, then the company goes for liquidation.

Source- Economic Times.