At a recent meeting of the committee of creditors of Jaypee Infratech, NBCC argued that upfront cash infusion into the company should not be the criteria for selecting a bidder. NBCC argued, “Evaluation matrix should be linked to the construction cost i.e. the amount utilised for the construction rather than the amount infused in the company.”
Business Standard has reviewed the minutes of the creditors meeting in which potential bidders such as NBCC and Cube Highways & Infrastructure, along with bankers and other creditors were present.
To NBCC’s arguments, the interim resolution professional (IRP) replied that there should be a guarantee that the chosen bidder would make payments as promised. He emphasised on this because it has been found in many cases that the promised payments did not come.
“Lenders have to be assured of the ability of the bidder to raise money to deliver what was promised in the resolution plan,” said the resolution professional’s legal advisor. IRP is planning to seek an extension of 90 days to complete the resolution. Bidders have been conducting due diligence and physical survey of the assets of Jaypee Infratech. From August 2017 to December 2018, total real estate cost incurred during insolvency resolution process was Rs 467 crore. Total collection from real estate stood at Rs 245 crore.
Jaypee Infratech got a lifeline after the Supreme Court sent back the case to the NCLT for a resolution. The company had Rs 27.9 crore as cash balance as on December 2018.
 "Jaypee infratech")