[ad_1]
National Company Law Tribunal Consortium led by Ashden Developers has been approved bankruptcy Resolution plan for debt-ridden real estate developers DS Kulkarni Developers, The successful consortium has proposed to pay Rs 826.30 crore to the stakeholders of the developers.
Apart from Ashdon Properties, the consortium also includes Classic Promoters & Builders and Atul builders. The resolution professional had received three bids for the resolution from entities including Mantra Properties & Developers and a consortium led by Hemendra Shah.
The successful resolution plan of the consortium led by Ashden Developers will see payments to secured creditors, unsecured creditors and operational creditors. Home buyers will be given flats on their claim amount.
Senior advocate Vikram Nankani and advocate Shyam Kapadia appeared for the successful resolution applicant and informed the tribunal that the amount paid upfront amounts to Rs 30.12 crore, as well as Series-I non-convertible debentures (NCDs) of Rs 536.18 crore and Rs 260 Are included. Crore in Series-II NCDs.
The scheme has been approved by more than 83.3% of the lenders represented by the Committee of Creditors (CoC), which includes state Bank of India, ICICI Home Finance Company, Bank of Maharashtra, Bank of India, IDBI Bank, Tata Capital Housing Finance and home buyers.
Based on an application filed by lender Bank of Maharashtra, the Mumbai bench of the National Company Law Tribunal (NCLT)NCLT) had in September 2019 ordered initiation of the Corporate Insolvency Resolution Process (CIRP) in respect of DS Kulkarni Developers under the provisions of the Insolvency and Bankruptcy Code, 2016.
Over 700 home buyers in the five stalled projects are awaiting possession of their homes in various projects of the company, which has developed projects in Pune, Mumbai, Bengaluru, Nashik and New Jersey in the US.
Lenders and operational creditors of the troubled developer had claimed around Rs 1,750 crore, of which around Rs 1,050 crore is from 12 banks and other financial institutions. These financial creditors hold approximately 66.7% of the voting rights in the Committee of Creditors.
The CoC has held a total of 25 meetings so far and six meetings of the company’s creditors have been postponed.
Steady progress has been observed in terms of resolution of insolvency and bankruptcy cases of real estate companies despite several complications including a large number of distressed home buyers.
Latest data from the Insolvency and Bankruptcy Board of India (IBBI) shows that a total of 6,571 companies across sectors were brought into administration by the end of March this year. Of these, about 21% or 1,380 companies were from the real estate sector, of which 854 or about 62% companies have seen a successful resolution plan since the introduction of the Insolvency and Bankruptcy Code (IBC) in 2016.
As the demand for residential and commercial properties is increasing, many strategic buyers and investors are actively looking for real estate companies with large land parcels under bankruptcy administration for loan defaults, especially in cities.
Despite the challenge of bankruptcy, given the presence of tangible assets including land parcels and unfinished structures with a certain share of sales, these companies and their projects still have good investor interest.
[ad_2]
Source link