The promoters of debt-ridden Jaypee Infratech Ltd (JIL) have made a last minute offer to withdraw the company from insolvency proceedings, a la Ruias of Essar Steel, sources aware of the development told CNBC-TV18.

In a letter dated February 15, Jaiprakash Associates Ltd (JAL) - promoters of JIL - made an offer to the financial and operational creditors of JIL under Section 12A of the Insolvency & Bankruptcy Code (IBC), said people familiar with the matter.

The settlement offer comes even as two bids have already been placed for acquiring Jaypee Infratech under IBC from state-owned NBCC and Suraksha Group, as reported by CNBC-TV18 earlier.

Banking sources pointed out that NBCC is seen as the frontrunner by the financial creditors, with a higher upfront payment of Rs 1,000 crore, compared to Rs 30 crore offered upfront by rival Suraksha Group.

As per this offer, JAL is offering an upfront payment of Rs 1,500 crore to the financial creditors of Jaypee Infratech, another Rs 4,858 crore from transfer of 100 percent shareholding of JIL’s Land Bank SPV (having a land bank of 1,475 acres) to financial creditors towards settlement of dues via a debt-asset swap and Rs 2,000 crore as optionally convertible debentures at a coupon rate of 0.01 percent per annum.

Sources added that JAL has also sought a complete waiver of Rs 1,425 crore interest payment due to the financial creditors.

As for the home buyers, sources told CNBC-TV18 that JAL has offered to complete the projects at Wishtown Noida over three years and projects at LP-3, Mirapur, over a period of four years from the date of final approval.

In addition, JAL has also offered a waiver of 50 percent of the stamp duty charges, one-year free maintenance to all home buyers and 2,000 equity shares out of JAL's own equity in JIL to each home buyer, as per sources.

JAL has also offered to settle the entire sum of Rs 120 crore owed to fixed deposit holders up front. As for the operational creditors, JAL has offered to pay Yamuna Expressway Industrial Development Authority (YEIDA) Rs 75 crore upfront and Rs 150 crore in suitable half-yearly instalments. It has also promised Rs 3 crore upfront payment to other operational creditors for their dues, said sources.

JAL had earlier submitted Rs 750 crore in the interest of the homebuyers in the Supreme Court in 2018, which the apex court has transferred to National Company Law Tribunal (NCLT) Allahabad now.

Details of NBCC Offer:

Upfront payment to secured financial creditors: Rs 1,000 crore.

Transfer of 100 percent shareholding of Land Bank SPV with 1,426 acres of land to secured financial creditors to settle dues of Rs 3,001 crore ore (Debt Asset Swap).

Transfer of 100 percent shareholding of Yamuna Expressway SPV to secured financial creditors for settling Rs 5,782 crore dues.

Entire claims of homebuyers to be satisfied by ensuring the delivery of flat units in 4-5 years from the transfer date.

NBCC to infuse Rs 500 crore upfront to complete housing projects of Jaypee Infratech.

Details of Suraksha Group Offer:

SPV formed by Suraksha Realty Limited and Lakshdeep Investments and Finance to bid for Jaypee Infratech.

Insolvency Resolution Process cost estimated at Rs 20 crore.

Rs 30 offered an upfront payment to financial creditors and fixed deposit holders.

Rs 5,000 crore financial creditors’ dues to be settled by the transfer of 100 percent stake in land bank SPV (Debt Asset Swap).

Rs 3,000 crore for completion of Jaypee Infratech's real estate projects.

Rs 1.19 crore for workers dues.

First Published:Feb 19, 2019 6:17 PM IST