After rejecting Suraksha group’s bid to acquire Jaypee Infratech, the bankrupt company’s Committee of Creditors (CoC) is considering inviting more bids now that the National Company Law Tribunal (NCLT) has permitted the continuation of the resolution process until the next hearing on May 21.
The earlier court-mandated deadline for the completion of the resolution process would have ended on May 6. However, lead lender IDBI Bank had moved the NCLT last Monday seeking a six-month extension of proceedings.
“If we get an extension from the court, the Committee of Creditors (CoC) can consider inviting more bids for the group. Else we will look at the NBCC bid,” one of the sources had told this publication.
The NCLT has already granted an extension to the lenders and Interim Resolution Professional Anuj Jain. On January 28, it had extended the period of the corporate insolvency resolution process by 90 days as the 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 under 180 days, with a further extension of 90 days to 270 days if the process could not be completed on time. If a company fails to complete the CIRP within the mandated 270 days, then it will go for liquidation.
In case IDBI Bank gets the NCLT’s nod for the six-month extension it is seeking, it will increase the chances of Adani Group bidding for the project. The group, the latest to enter the fray, has already expressed interest in bidding for Jaypee’s real estate arm in order to strengthen its position in the Delhi-NCR region.
Meanwhile, the CoC will meet on May 9 to review the revised bid of state-owned NBCC Ltd, which had been shunted aside by the lenders last month due to a lack of approvals from the government. Now, however, the state-run construction firm has secured the necessary approvals. To protect lenders interest, NBCC has offered Rs 5,000 crore worth land as well as 100 per cent equity in Yamuna Expressway, the only cash-generating asset of Jaypee Infratech.
On Friday, the CoC also rejected the bid of Mumbai-based Suraksha Realty group, which was the only other contender.
During the first round of insolvency proceedings for the Jaypee firm, a Rs 7,350 crore bid from Lakshdeep, part of the Suraksha group, had been rejected since the offer was found to be substantially lower than the company’s net worth and assets, as well as an estimated liquidation value of around Rs 14,000 crore. The company’s Resolution Professional had initiated fresh bidding on the NCLT’s direction on October 2018.
More delays likely in resolution
In case IDBI Bank gets the NCLT’s nod for the six-month extension it is seeking, it will increase the chances of Adani Group bidding for the project. The group, the latest to enter the fray, has already expressed interest
Another fresh round of bidding would mean that affected homebuyers in the project will need to wait for even longer before work on their incomplete apartments can finally begin, extending an already years-long delay