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infrastructure | IST

EXCLUSIVE: Setback for Jaypee Infratech homebuyers, Suraksha Group's bid rejected

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It is deja-vu for the homebuyers of debt-ridden Jaypee Infratech, with the committee of creditors once again rejecting the resolution plan submitted by Suraksha Group.

It is deja-vu for the homebuyers of debt-ridden Jaypee Infratech, with the committee of creditors once again rejecting the resolution plan submitted by Suraksha Group, leaving over 20,000 homeowners in the lurch, sources aware of the development told CNBC-TV18.
Jaypee Infratech, which is facing a second round of insolvency proceedings after Suraksha Group’s plan was rejected in round one as well, and the company was facing the threat of liquidation until the Supreme Court intervened last year.
Sources told CNBC-TV18 that only about 9,000 of the total 20,000 odd homebuyers participated in the voting process for Suraksha Group’s plan, which began on April 30 and ended today.
Homebuyers form almost sixty percent of the committee of creditors (CoC). In total, forty percent of the CoC voted against Suraksha Group’s plan, about 20 percent in favour and the remaining abstained from voting, a source informed CNBC-TV18. The required votes needed to clear a resolution plan is currently 66 percent. Suraksha Group’s plan failed to muster the requisite votes and stands rejected.
As the next step, CoC will meet on May 9 to take a call on whether to invite fresh bids for Jaypee Infratech. If Allahabad Bench of NCLT allows extension with the 270-day timeline, CoC may invite bids again from NBCC and Adani Group.
With this latest development in the case, the company once again faces the threat of liquidation, with the 270-day deadline under IBC coming to an end soon, on May 6. While IDBI bank has sought an extension in this timeline from Ahmedabad NCLT, the case will only next to be heard on May 6 itself, leaving the CoC in a precarious position.
NBCC, which was the other bidder in the fray, could not initially participate in the bidding due to lack of government approvals, which it managed to secure only after the voting on Suraksha Group’s plan had begun. Sources said that lenders have not yet taken a call on considering NBCC’s bid as of now.