Reviving Stalled Real Estate Projects: NCLT Approves Alchemist Infra Realty's Acquisition
The acquisition of Alchemist Infra Realty Ltd by Vantage Point Asset Management Pte Ltd has been approved by the National Company Law Tribunal, paving the way for the revival of stalled real estate projects.
Real EstateInsolvency ResolutionNcltAlchemist Infra RealtyVantage Point Asset ManagementReal EstateJul 25, 2024
The company's resolution professional had received claims of Rs 1,293 crore, and the successful bidder is paying about Rs 470 crore to acquire the company through the insolvency resolution process. Before the approval, the lenders of the Delhi-based real estate firm had approved the revival plan of Vantage Point Asset Management with 100% voting in its favour.
The NCLT's division bench, comprising judicial member Ashok Kumar Bharadwaj and technical member Subrata Kumar Dash, directed Vantage Point Asset Management to furnish an updated bank guarantee, which should remain valid till the implementation of the resolution plan. The resolution professional had received claims of about Rs 1,293 crore and admitted claims of about Rs 947 crore.
Alchemist Infra Realty, a Delhi-based real estate firm, had defaulted on its dues of about Rs 401 crore, leading to its admission under the corporate insolvency resolution process (CIRP) in March 2022. The company's fair market value was estimated at Rs 380 crore, while the liquidation value was pegged at Rs 302 crore. The successful bidder is paying more than both fair value and liquidation value.
Industry experts believe that taking over by another company remains the only option to revive stuck projects in northern India. With the rise in property and land prices, many projects are now viable and are seeing a lot of interest from potential investors or developers.
According to the latest data from the Insolvency and Bankruptcy Board of India, a total of 7,567 companies across sectors were brought into administration until March-end, since the inception of the Insolvency and Bankruptcy Code in 2016. Of these, 1,589 or 21% were from the real estate sector. About 15% of the total companies admitted under the CIRP that witnessed revival or acquisition from a new bidder were from the real estate sector.
Alchemist Infra Realty Ltd is a Delhi-based real estate firm that was admitted under the corporate insolvency resolution process (CIRP) in March 2022. Vantage Point Asset Management Pte Ltd is a Singapore-based asset management company that has acquired Alchemist Infra Realty Ltd through the insolvency resolution process.Vantage Point Asset Management Pte Ltd is a Singapore-based asset management company that specializes in real estate investments. The company has a strong track record of reviving stalled projects and has invested in several real estate projects across India.
Frequently Asked Questions
What is the insolvency resolution process?
The insolvency resolution process is a mechanism under the Insolvency and Bankruptcy Code (IBC) that allows companies to restructure their debt and revive their businesses.
How many companies have been brought into administration under the IBC?
According to the latest data, a total of 7,567 companies across sectors have been brought into administration until March-end, since the inception of the Insolvency and Bankruptcy Code in 2016.
What percentage of companies admitted under the CIRP are from the real estate sector?
About 21% of the total companies admitted under the CIRP are from the real estate sector.
What is the fair market value of Alchemist Infra Realty Ltd?
The fair market value of Alchemist Infra Realty Ltd was estimated at Rs 380 crore.
What is the liquidation value of Alchemist Infra Realty Ltd?
The liquidation value of Alchemist Infra Realty Ltd was pegged at Rs 302 crore.
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