NCLT Clears Adani Properties’ Bid for HDIL Assets Worth Over Rs. 2,000 Crore

The National Company Law Tribunal (NCLT) has sanctioned Adani Properties' acquisition of two assets from the defunct Housing Development and Infrastructure (HDIL). These assets include a commercial property named 'Inspire BKC' in Mumbai's Bandra-Kurla Complex and a land parcel in Kalyan Shahad. The acquisition was part of the corporate insolvency resolution process (CIRP), with Adani Properties being the sole bidder meeting the Insolvency and Bankruptcy Code (IBC) requirements.

Adani Properties' resolution plan for the InspireKC project is valued at Rs 3 crore, allocating Rs 2.85 crore to creditors and Rs 15 lakh for CIRP costs. For the Shahad land parcel, its fair value and liquidation value are estimated at Rs 89.66 crore and Rs 62. crore, respectively. Industry experts estimate these assets together are worth over Rs 2,000 crore.

Resolution Plan Details

The Mumbai bench of NCLT approved the resolution plans under Section 31 of the IBC, 2016. The committee of creditors (CoC) had cleared both plans with a 66.08% voting share in November 2022. HDIL has been undergoing insolvency since 2019, with liabilities exceeding Rs 7,789 crore.

Initially, HDIL's resolution professional sought interest for resolving the entire company in February 2020 but received no proposals. Due to unfinished residential properties, the National Company Law Appellate Tribunal (NCLAT allowed a project-wise resolution plan. The CoC initially rejected this proposal but reversed its stance in September 2021 after objections from homebuyers.

HDIL was divided into ten verticals to streamline the resolution process. The current approvals to Adani Properties include verticals V and IX. For Vertical V, which includes the Inspire BKC project, Adani will not acquire HDIL as a going concern but will demerge the BKC project into itself or a subsidiary.

Adani has agreed to continue the existing Slum Rehabilitation Authority (SRA) development agreement with Budhpur Buildcon. Budhpur Buildcon holds the Letter of Intent for completing the slum rehabilitation project that HDIL began in BKC under SRA oversight.

Shahad Land Parcel Acquisition

In Vertical IX, involving the Shahad land parcel, Punjab and Maharashtra Cooperative Bank - now Unity Small Finance Bank - is the sole secured creditor holding mortgage rights. The tribunal dismissed their valuation objections in July 2024. Both plans include performance guarantees of Rs5 crore each as required by CIRP regulations.

The Rakesh Wadhawan-promoted HDIL faced insolvency due to significant liabilities. Despite initial setbacks in finding a comprehensive resolution plan for HDIL's entire portfolio, project-wise resolutions have been pursued successfully.

Adani Properties' strategic acquisition marks a significant step in resolving HDIL's insolvency issues through targeted asset acquisitions within Mumbai's real estate landscape.