Suraksha Realty wins Jaypee Infratech bid; turns private
Real Estate

Suraksha Realty wins Jaypee Infratech bid; turns private

Suraksha Realty, the winning bidder for Jaypee Infratech, will pay an exit price to retail shareholders as the company delists from stock exchanges. Shareholders holding approximately 542 million equity units will be compensated at a value on par with the company's liquidation value.

"The board of directors has set June 21, 2024, as the record date for determining which shareholders will receive the exit price," stated a regulatory disclosure. The exit price, an aggregate amount of Rs 1.4 million, matches the liquidation value, according to the company.

This move is seen as a goodwill gesture, according to a lender. Ashish Pyasi, a partner at Aendri Legal, noted that shareholders are typically the last to receive payment under the insolvency code's waterfall mechanism, often receiving nothing if the debt is too high. He highlighted the uniqueness of Jaypee Infratech?s resolution plan, as retail shareholders are rarely offered exit prices in such cases.

At the time the resolution plan was approved, Jaypee Infratech had liabilities exceeding Rs 230.83 billion, including Rs 97.83 billion owed to secured financial creditors. Nipun Singhvi, managing partner at NSA Legal, mentioned that this payment to shareholders could set a precedent for future cases, as typically there isn?t enough payout to cover even the financial creditors.

Historically, shareholders have not been compensated in similar situations, such as with National Steel and Agro Industries (NSAIL), Videocon Industries, and Sintex Industries. This development coincides with an investor in Reliance Capital (RCAP) approaching the Bombay High Court to challenge the company's delisting following its resolution process closure.

Last year, the National Company Law Tribunal (NCLT) approved Suraksha Realty's resolution plan, which included offering around 2,500 acres to bankers and Rs 13 billion in non-convertible debentures. Suraksha Realty also committed to completing all pending flats for customers within four years. Jaypee Infra shares recently closed at Rs 1.27 each, with a market cap of Rs 1.76 billion.

Suraksha Realty, the winning bidder for Jaypee Infratech, will pay an exit price to retail shareholders as the company delists from stock exchanges. Shareholders holding approximately 542 million equity units will be compensated at a value on par with the company's liquidation value. The board of directors has set June 21, 2024, as the record date for determining which shareholders will receive the exit price, stated a regulatory disclosure. The exit price, an aggregate amount of Rs 1.4 million, matches the liquidation value, according to the company. This move is seen as a goodwill gesture, according to a lender. Ashish Pyasi, a partner at Aendri Legal, noted that shareholders are typically the last to receive payment under the insolvency code's waterfall mechanism, often receiving nothing if the debt is too high. He highlighted the uniqueness of Jaypee Infratech?s resolution plan, as retail shareholders are rarely offered exit prices in such cases. At the time the resolution plan was approved, Jaypee Infratech had liabilities exceeding Rs 230.83 billion, including Rs 97.83 billion owed to secured financial creditors. Nipun Singhvi, managing partner at NSA Legal, mentioned that this payment to shareholders could set a precedent for future cases, as typically there isn?t enough payout to cover even the financial creditors. Historically, shareholders have not been compensated in similar situations, such as with National Steel and Agro Industries (NSAIL), Videocon Industries, and Sintex Industries. This development coincides with an investor in Reliance Capital (RCAP) approaching the Bombay High Court to challenge the company's delisting following its resolution process closure. Last year, the National Company Law Tribunal (NCLT) approved Suraksha Realty's resolution plan, which included offering around 2,500 acres to bankers and Rs 13 billion in non-convertible debentures. Suraksha Realty also committed to completing all pending flats for customers within four years. Jaypee Infra shares recently closed at Rs 1.27 each, with a market cap of Rs 1.76 billion.

Next Story
Real Estate

Serene, Gardencity to Develop Rs 3 Billion Senior Living Project in Bengaluru

Serene Communities, a leading senior living brand, has partnered with Gardencity Realty to develop a premium senior living community in Budigere, one of Bengaluru’s fastest-growing residential micro-markets. The project will span approximately 300,000 sq ft, with a Gross Development Value of about Rs 3 billion, and will add roughly 250 senior-friendly residences to the city’s growing retirement housing segment.The launch forms part of Serene Communities’ national expansion strategy. The company has 11 new projects under development with a planned investment of Rs 25 billion that will add..

Next Story
Real Estate

Alliance City Developers Marks Major 2025 Milestones in Vile Parle

Alliance City Developers Realtors has announced significant project milestones and expansions in 2025, underscoring what the company terms a transformational year. The developer completed multiple residential projects and launched two premium developments in Vile Parle (East), one of Mumbai’s most sought-after neighbourhoods.During the year, Alliance Legacy in Matunga (East) received its Occupancy Certificate (OC), while Alliance Eternis in Borivali (West) and Alliance Vista in Vile Parle (East) were granted Completion Certificates (CC), marking final project delivery. Alliance Abhimanyu is ..

Next Story
Infrastructure Energy

Moro Hub and PwC Middle East Partner to Accelerate Smart City Solutions

Moro Hub, a subsidiary of Digital DEWA, the digital arm of Dubai Electricity and Water Authority (DEWA), has announced a strategic collaboration with PwC Middle East to advance Smart City, Integrated Command Centre (ICC), Critical Infrastructure Monitoring and Internet of Things (IoT) initiatives across the region. The partnership brings together Moro Hub’s digital infrastructure and IoT capabilities with PwC’s global expertise in digital trust, smart city strategy and cybersecurity to support the UAE’s vision for intelligent and sustainable cities.“Our collaboration with PwC Middle Ea..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Open In App