Adani Goodhomes acquires Radius Estates and Developers for Rs 32 crore

The year 2023 may not have started in the best possible way for the Insolvency and Bankruptcy Code (IBC). The first resolution under IBC in 2023 saw financial creditors taking 98% haircut.

The Mumbai Bench of the National Company Law Tribunal (NCLT) on 9 January 2023 approved the Rs 32-crore bid by Adani Goodhomes Private Limited for real estate company Radius Estates and Developers Private Limited. Radius Estates and Developers owed Rs 1,892 crore to financial creditors, which means the financial creditors had to take a 98.4% haircut in the CIRP.

As per the resolution plan of Adani Goodhomes, secured creditors gets Rs 31.5 crore against their admitted claims of Rs 1,187 crore. Unsecured creditors (unrelated parties), who had claimed Rs 471 crore, will get a mere Rs 47 lakh under the resolution plan. Related party unsecured creditors, who had claimed Rs 234 crore, will get no money from the bidder — Adani Goodhomes.

Provision for Homebuyers

Homebuyers who have not sought for refund and/or who do not have orders for refund will be given units in the project.  The date on which the Unit Homebuyers will be given possession of their Units will be 6th June 2024, subject to the conditions

Any of the Unit erstwhile homebuyers who have sought a refund earlier from the Corporate Debtor and/or have orders for refund in their favour against the Corporate Debtor or wish to seek refund,  will have to, within a period of 30 days from the COC Approval Date, elect whether they want a refund.

Those homebuyers who elect in writing for a refund on or prior to the Election Date will be deemed to have given up their right to the Units that had been purchased by them and will be given a refund of only the principal amount of the consideration paid by them, notwithstanding any order to the contrary.

The refund shall be payable from the proceeds received from sale of the Units that had been allotted to such Erstwhile Homebuyers. The refund shall be paid to the Erstwhile Homebuyer or its lender (as the case may be) within 30 days of each payment received from the new buyer in proportion to the principal amount that the Erstwhile Homeowner had paid to the Corporate Debtor. In any event, all of the pending principal amount (if any) of the Erstwhile Homebuyers will be paid by 30 June 2025.

Homebuyers had submitted claims of Rs 747 crore, of which Rs 634 crore was admitted by the resolution professional — Jayesh Sanghrajka.

Employees and Workmen

Employees and Workmen will be paid an amount of Rs. 1.51crore on the effective date towards full payment of the Admitted Employees and Workmen Debt, and in full and final settlement towards all amounts due and payable to them (whether towards retirement benefits, gratuity, bonus, provident fund or otherwise) in the priority prescribed under the Code.

All Employees and Workmen will be deemed to have relinquished any claim for any other dues. The appropriation of the Employees and Workmen Payment to the Employees and Workmen will be as per the claims admitted.

No other creditors will get any money as per approved resolution plan of Adani Goodhomes.

Brief of the case

Radius Estate and developers Pvt Ltd, the Corporate Debtor is engaged in the business of construction and development of real estate including construction of residential and commercial properties. The Corporate Debtor had development rights in the immoveable property on the MHADA leasehold land admeasuring 20,149.40 sq. mtrs. on the Gandhinagar Layout of MHADA, Bandra (east), Mumbai and was in the process of constructing and developing the project TEN BKC.

It defaulted on a payment of Rs 22.35 crore to debenture holders. Beacon Trusteeship Limited, on behalf of the debenture holders, filed an insolvency application with NCLT against Radius Estate and developers. The same was admitted by the NCLT in April 2021.

Adani Goodhomes, an Adani group company, along with Ashdan Properties Private Limited jointly with Ashdan Developers Private bid for Radius Estate. The committee of creditors accepted the bid by Adani Goodhomes by 83.93% vote share.

Also read: 3,000 homebuyers submit Rs 3,192 cr claims against Ansal Properties and Infrastructure