Gammon highest bidder for PAL-Peugeot plot

Almost three years after losing a bid for a 135-acre plot at Dombivli, a suburb here, by a whisker, construction firm Gammon India has emerged the highest bidder for the same plot, owned by PAL-Peugeot.

The difference between Gammon's bid and the next highest one was just Rs 1 crore — exactly the same amount by which it had lost last time.

Gammon quoted Rs 601 crore for the plot auctioned by the High Court receiver yesterday. The Neptune group offered Rs 600 crore. At that price, the bid is Rs 1,022 per sq ft of land. Currently, real estate prices are Rs 3,200-4,000 a sq ft in the Dombivli area.

During the last occasion in April 2008, Citra Developers, a unit of Indiabulls Real Estate, emerged as the highest bidder for the plot, by quoting Rs 676 crore for the land. Gammon lost by having offered Rs 675 crore. Though Citra's was the highest bid, it was not ready to raise the amount to match the reserve price (the floor set for the transaction). Therefore, the HC allowed the company to withdraw the bid.

This time, Gammon took part in the public auction through its unit, Metropolitan, said an executive who was present at the auction. Another Mumbai developer Oberoi Realty, also took part in the bid, he said.

However, the bid has to be cleared by the HC, as ICICI Bank had earlier filed a suit against PAL-Peugeot for recovery of the amount it had to collect as a trustee for debenture holders of PAL-Peugeot. The claim in the suit was for Rs 136.8 crore.

The HC had appointed a receiver and directed to sell the properties, including the land. The auctions were conducted on five occasions but the highest bid failed to match the reserve price fixed by the HC, at Rs 1,650 crore.

In February this year, the Supreme Court directed fixing a new reserve price for the auction. However, bidders in Thursday's auction said there was no reserve price this time. When asked, Gammon India’s managing director, Abhjijit Rajan, said: “It is a court process. It is not over yet.” When asked what Gammon would do with the land, Rajan said: “Things would be clear next week.”

When Citra won the bid, it was estimated the plot had development potential of 15 million sq ft.