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JIL Case: Suraksha Reaches Out To Homebuyers, Says Co Should Be First Preference, Not Standby Option

The CoC had rejected NBCC's bid citing non-compliance with certain provisions of the Insolvency and Bankruptcy Code (IBC) and a Supreme Court order, that was passed on March 24, in the JIL case.

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Asserting that its bid to acquire Jaypee Infratech is legally compliant and better, Suraksha group has urged homebuyers to support its resolution plan and vote against a proposal to allow more time for submission of new offers by the company and NBCC.

In a video message on You Tube platform, Suraksha ARC Managing Director and Chief Executive Officer Aalok Dave has sought to reach out to around 20,000 homebuyers whose investments are stuck in stalled projects of Jaypee Infratech Ltd (JIL).

Stating that the company does not fear competition, Dave told homebuyers that 'we should be your first preference and not standby option.' The voting process on whether to seek fresh bids for JIL from Suraksha group and NBCC commenced on Thursday. The video message was posted late Wednesday.

Based on his discussions with lenders, Dave said banks are in favour of resolution and they will vote for a plan that is compliant and better for them on merit.

During its meeting on May 24, the Committee of Creditors (CoC) deferred the voting process on Suraksha group's bid. It also decided to conduct a voting process on May 27-28 to decide whether the two contenders -- NBCC and Suraksha group -- should be given additional time to submit their revised and final bids.

If the voters decide against giving more time to both the parties, then Suraksha group's offer would be put to vote next week.

Earlier, on May 20, the CoC had rejected NBCC's bid citing non-compliance with certain provisions of the Insolvency and Bankruptcy Code (IBC) and a Supreme Court order, that was passed on March 24, in the JIL case.

Dave said the company's bid is legally compliant and it has also given an undertaking that shortfall to dissenting financial creditors, if any, will be met.

He said the company's offer is better and hoped that banks would vote on merit to maximise value, and pointed out that the CoC, on May 20, had decided to put to vote Suraksha group's resolution plan.

'Even now, banks are for resolution, banks are for compliant plan and banks are going to vote for the plan which on merit basis is better for them,' he told homebuyers.

Stating that two months have already lapsed since Supreme Court order, Dave asked, 'Why to reopen all things?... Why extension?.' Suraksha group has incorporated all wish lists of homebuyers and lenders in its resolution plan, he added.

Further, Dave said the company is putting Rs 250 crore equity upfront and arranging Rs 3,000 crore construction finance loan to complete 20,000 flats within 42 months. The total investment is estimated at Rs 6,000 crore for completion.

According to him, the collection from homebuyers on flats already sold, sale proceeds of unsold units, toll income from Yamuna Expressway will be utilised to complete stalled projects.

'Funds are most critical raw material to achieve the timeline. We have brought that fund,' he noted.

Moreover, Dave said the company has set aside Rs 400 crore-worth land parcel for delayed compensation and promised to offer a discount of 25 per cent on society maintenance. It will also compensate those who made early payments.

'We have not left any wish list of banks and homebuyers in our plan... Why to reopen the whole process,' he said, adding that it was now for them to decide.

JIL went into the insolvency process in August 2017 after the National Company Law Tribunal (NCLT) admitted an application by an IDBI Bank-led consortium.

In December 2019, the CoC approved the resolution plan of NBCC in the third round of bidding and in March 2020, the same was approved by NCLT.

However, the order was challenged before the National Company Law Appellate Tribunal (NCLAT) and later in the Supreme Court, which in March this year ordered that fresh bids be invited only from NBCC and Suraksha. 

(PTI)