EXCLUSIVE | Lenders reject Lakshadweep’s offer to buy Jaypee Infra, ball now in Supreme Court

The lenders who rejected the offer are IFCI, India Infrastructure Finance, Life Insurance Corp of India, Union Bank of India, Axis Bank, Syndicate Bank and Corporation Bank, a source told Moneycontrol

Most of the lenders of Jaypee Infratech have rejected Lakshadweep Pvt Ltd’s Rs 7000-crore offer to buy Jaypee Infratech as it was found too low, a source told Moneycontrol. The committee of creditors met on Wednesday and lenders accounting for 42 percent of the company’s debt turned down the offer. For the offer to succeed, creditors accounting for 75 percent of the company’s debt had to approve the offer.

The lenders who rejected the offer are IFCI, India Infrastructure Finance, Life Insurance Corp of India, Union Bank of India, Axis Bank, Syndicate Bank and Corporation Bank, the source said.

Lakshadweep was the sole remaining bidder to buy the stressed assets of the Jaiprakash Associates subsidiary. The company has been run by an insolvency professional, appointed by the National Company Law Tribunal, for almost nine months now. Lakshadweep had earlier outpaced Kotak-Realty Cube and the Adani Group to emerge as the highest bidder for the Noida-based real estate developer and Yamuna Expressway operator.

But Lakshadweep’s prospects dimmed after several creditors objected to the offer, saying it was too low for the company. According to a note prepared by IDBI Bank, Jaypee’s largest lender, the company’s actual value stands at Rs 17,111 while its distress value is pegged at Rs 14,548 crore. Lakshadweep’s Rs 7,000 crore bid pegged Jaypee’s value at less than half of IDBI’s distress scenario number.

Jaypee Greens is one of the 12 companies the Reserve Bank of India referred to the National Company Law Tribunal last year as an insolvency case whose day-to-day running needed to be put in the hands of a professional for resolution of its Rs 9,000-crore debt.

Jaiprakash Associates on Monday made a revised bid of Rs 10,000 crore but the creditors can’t consider its offer as the bankruptcy law bars promoters from making a bid for the company.

The Allahabad bench of NCLT that is hearing the case could now ask all the parties to approach the Supreme Court. The Supreme Court meets May 11 to hear the matter before it breaks for a two-month-long vacation.

Source : moneycontrol.com date : 09/05/2018