Realty developer M3M has emerged as the highest bidder for Religare-backed Dignity Buildcon’s Vision Tower complex in Gurgaon with a bid of Rs 533 crore, two persons aware of the matter said.
The company will invest another Rs 500 crore in the property that has a total area of 1.1 million sq ft across three towers. According to the first person familiar with the process, professional services firm EY conducted an open bid on Sunday.
“Initially, 15 developers have shown intestate and five of them participated in the open bidding process. The project offers an opportunity to generate good returns and multiple foreign funds were keen to take it over,” said the person. M3M has offered to pay about Rs 20 crore as an upfront amount and the rest of it in installments in four years. The lenders will now vote for the resolution plan.
Dignity Buildcon which owns the Vision Towers assets is a special purpose vehicle that was part of the Religare NSE 5.26 % Group. Dignity was dragged to the National Company Law Tribunal (NCLT) by Sudhir Power who had initiated Insolvency proceedings against the company for non-payment of dues. The NCLT had ordered the corporate insolvency resolution process be initiated against Dignity vide order of April 24, 2019.
According to sources, M3M was the highest bidder in the open bidding process with an offer to invest Rs 1,000 crore—including paying Rs 533 crore to creditors to settle their dues — for the revival of the stuck complex.
Some foreign funds and Indian Banks are among the creditors. Final bidders participated in an open bidding and auction process with the Resolution Professional and Committee of Creditors that started on Friday morning and culminated late on Sunday evening. Other than bid cost, the additional expense will be incurred on a renovation, creditors payment, and getting approvals.
“The commercial tower is part of the insolvency process and the amount will be used to pay off creditors. The selected bidder will be able to generate revenue through lease of commercial and retail area,” said another person. EY and M3M did not respond to the email query till press time.
The other bids were in the range of Rs 410 to Rs 490 crore. M3M has multiple retail and commercial projects at the Golf Course extension road. The company has over 2,200 acres of land in the NCR, which consists of New Delhi and areas around the capital including Gurgaon