Lakshadweep, a joint venture between Suraksha Asset Reconstruction Company and Mumbai-based Dosti Reality that emerged as the top bidder for embattled real estate developer Jaypee Infratech, may increase its bid value by nearly 5% to around Rs 7,700 crore, a source close to the development said. Bankers have been unhappy with the “low bids” received during the insolvency resolution process and wanted the bids to “at least match the liquidation value” of the company, which is Rs 7,700 crore. Jaypee Infratech’s outstanding dues to the banks are around Rs 9,000 crore.
According to the source, Lakshadweep has had several rounds of negotiations with the lenders over the last fortnight. ICICI Bank, IDBI Bank and State Bank of India are the three largest lenders to parent Jaiprakash Associates Group.
On October 27, 2017, the resolution professional had invited companies, including real estate firms, with a net worth of over Rs 1,000 crore to complete the delayed projects of Jaypee Infratech, including Noida’s Wish Town project, by infusing Rs 2,000 crore or more. Among the 18 companies that had shown interest in buying Jaypee Infratech, three — Lakshadweep, the Adani Group and the Kotak-Cube consortium — were later shortlisted.
Lakshadweep, which had initially offered Rs 6,900 crore, revised the bid to Rs 7,350 crore. The company’s revised offer included around Rs 1,200-1,500 crore cash to the banks, Rs 4,000 crore worth of land and the rest in the form of long-term non-convertible debentures. The offer also included a small equity stake to lenders. Lakshadweep’s offer was better than the Adani Group’s Rs 5,500 crore bid and Kotak-Cube’s offer of Rs 6,000 crore.
“The bids are not yet finalised… The top bidder have not yet come to the CoC (committee of creditors) for approval… The resolution professional has to present the final plan to the National Company Law Tribunal on May 7, so before that the process (of finalising the bid) will be completed,” another source said.
On August 9 last year, the NCLT’s Allahabad bench had accepted IDBI Bank’s plea and admitted Jaypee Infratech as a case under insolvency resolution for defaulting Rs 526 crore. The value of assets pledged by Jaypee Infratech with lenders is much higher than the company’s outstanding loans, as per the application filed by IDBI Bank before the NCLT.
According to IDBI Bank, the market value of the realtor’s pledged assets is estimated at Rs 17,116 crore. The distress value of the assets, on the other hand, is estimated to be Rs 14,548 crore. According to sources, total assets of the company, as per the assessments of the bank, were valued at Rs 33,000 crore.
The embattled real estate firm has until now deposited Rs 650 crore with the Supreme Court registry while the court had asked it to deposit a total of Rs 2,000 crore . The company has been directed to deposit another Rs 100 crore by May 10.