Adani Goodhomes' Resolution Plan for Radius Estates Upheld by NCLAT
The National Company Law Appellate Tribunal (NCLAT) has upheld Adani Goodhomes' resolution plan to take over the bankrupt real estate company Radius Estates
Real EstateInsolvencyNclatAdani GoodhomesRadius EstatesReal Estate NewsMay 28, 2024
Adani Goodhomes, a subsidiary of Adani Infrastructure and Developers Pvt. Ltd and part of the Adani Group, has offered around ₹76 crore to Radius Estates' creditors, who have outstanding loans amounting to approximately ₹1,700 crore, resulting in a 96% haircut for the creditors. Additionally, Adani Goodhomes has promised to complete the residential project in Mumbai at no further cost to the homeowners.
The resolution plan had received approval from over two-thirds of the company's creditors before being taken to the NCLT for final approval. Indian insolvency laws mandate that two-thirds of creditors of a bankrupt company must approve a debt resolution process. Nearly all of the 700 homeowners, holding a third of the voting power in the committee of creditors, had supported the bid, along with financial creditors such as HDFC Ltd and Yes Bank.
Radius Estates and Developers Pvt. Ltd. had partnered with MIG (Bandra) Realtors and Builders Pvt. Ltd. to redevelop land in Bandra (East), Mumbai. The project included constructing residential flats for the rehabilitation of members of the Middle-Income Group Co-operative Housing Society and a free-sale component. However, construction halted in January 2020, leading Beacon Trusteeship Ltd. to file a petition under Section 7 of the Insolvency and Bankruptcy Code, 2016, initiating the Corporate Insolvency Resolution Process (CIRP) against the company.
The National Company Law Appellate Tribunal (NCLAT) is a statutory body that hears appeals against the orders of the National Company Law Tribunal (NCLT). The NCLT is a quasi-judicial body that adjudicates disputes related to companies and insolvency. Adani Goodhomes is a subsidiary of Adani Infrastructure and Developers Pvt. Ltd and part of the Adani Group, a multinational conglomerate with interests in infrastructure, energy, and real estate.
Adani Infrastructure and Developers Pvt. Ltd is a leading infrastructure and real estate company in India. Adani Group is a multinational conglomerate with interests in infrastructure, energy, and real estate.
Frequently Asked Questions
What is the resolution plan proposed by Adani Goodhomes?
Adani Goodhomes has offered around ₹76 crore to Radius Estates' creditors who have outstanding loans amounting to approximately ₹1 700 crore resulting in a 96% haircut for the creditors
Why did creditors challenge the resolution plan?
Creditors claimed that the resolution professional (RP) Jayesh Sanghrajka and HDFC Ltd the largest creditor colluded leading to only one bid being received
What is the status of the residential project in Mumbai?
By the moratorium commencement date Radius Estates had sold 224 units and had 146 units left for sale with the project incomplete Out of the 15 proposed buildings only nine were partially constructed and the remaining six had not commenced
What is the role of NCLAT in this case?
NCLAT has upheld Adani Goodhomes' resolution plan rejecting challenges from creditors and debenture holders
What is the impact of the resolution plan on homeowners?
Adani Goodhomes has promised to complete the residential project in Mumbai at no further cost to the homeowners
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