Oberoi Realty arm buys out Nirmal Lifestyle Realty for Rs 273 crore

The National Company Law Tribunal (NCLT) has approved the Rs 273 crore resolution plan submitted by Oberoi Constructions Limited for Nirmal Lifestyle Realty Pvt Ltd. The Mumba-based Nirmal Lifestyle realty owed Rs 748 crore to different creditors.  The CoC approved the resolution plan with 100% vote share.

As per the resolution plan, Oberoi Constructions would pay Rs 185 crore to secured financial creditors against their admitted claims of Rs 660 crore.

For operational creditors, the resolution plan has provision of paying Rs 87 crore including Rs 7.5 crore towards dues to Employees’ Provident Fund Organisation. Though EPFO had filed an additional claim of Rs 34.32 crore, but the same was rejected by the resolution professional.  The plan also has a provision for payment of Rs 80 crore towards claims of employees and workmen.

As per the resolution plan, the pre-CIRP shareholding (including equity shares, the preference share capital of the Corporate Debtor on the CIRP Commencement Date) of the Promoters/Promoter Group and all other existing shareholders in the Corporate Debtor (except the equity shares allotted to Oberoi Constructions pursuant to the equity infusion into the corporate debtor) will be permanently cancelled for NIL consideration. The resolution applicant (along with its affiliates/nominees) will hold 100% of the share capital of the Corporate Debtor and acquire control of the Corporate Debtor. The Resolution Applicant will infuse 100,000 into the Corporate Debtor by way of subscription to equity shares of the Corporate Debtor in accordance with Section 5 of the resolution plan.

About the corporate debtor

Nirmal Lifestyle Realty was a leading property developer and was identified as the front ranking property development companies in Mumbai. It has built more than 50 lakh square feet residential and commercial spaces.

While building and construction has been the core activity for the company, quality and innovation has been the soul for its projects. The group has been instrumental in promoting Mulund as a preferred destination for both residential and commercial spaces, hence branding Mulund as the “Prince of Suburbs”. Establishments in Mulund sparked thirty years ago with “Jahawar Talkies”, a renowned theatre in this corner of the city.

Nirmal Lifestyle had become synonymous to Mulund with its vision and unprecedented approach towards the city. The company was initiated in the year 1975, by Late SP Jain.

Insolvency proceedings against the company was initiated by Aasan Corporate Solutions Private Limited, a financial creditor, in December 2021 after the former defaulted on a payment of Rs 258 crore.

About the resolution applicant

Oberoi Constructions Limited was incorporated on 02 November 1993 in Mumbai, as a private limited company initially known as Oberoi Constructions Private Limited, under the provisions of the Companies Act, 1956. Oberoi Constructions Private Limited was converted into public limited company on 13 July 2011, and consequently its name changed to Oberoi Constructions Limited. Oberoi Realty Limited is the holding company of the resolution applicant and is listed on the BSE and NSE. The Group is primarily engaged in real estate development activity, operating in the Mumbai Metropolitan region, focused on premium developments.

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