Fresh twist in Leela sale saga, headed for NCLT

JM Financial has reportedly filed a suit in the National Companies Law Tribunal (NCLT) last Thursday against the Nair brothers Vivek Nair (Guarantor) and Dinesh Nair (Guarantor) on the basis of a legal notice issued by Khaitan and Co on November 12 last year on behalf of its client SBI Cap Trustee Company against Hotel Leelaventure (Borrower), Leela Lace Holdings Pvt Ltd (Pledgor/Guarantor), Rockfort Estate Developers Pvt Ltd (Pledgor) and Leela Lace Software Solutions Pvt Ltd (Pledgor).

Anil Bhatia, MD of JM Financial Services, was not available for comment. On November 5, 2018, in another similar manoeuvre T Selvi Laxman, Advocate High Court on behalf of his client SBI, had filed a legal notice against Hotel Leelaventure and various officials including Vivek Nair CMD and his brother Dinesh Nair co CMD.

The process calls for a two-week period before NCLT accepts the JMF petition for bankruptcy proceedings. In the interregnum, it is believed that JMF will try to pressurise the Nairs to sign with Brookfield. The other two suitors - Rashid Al Habtoor and Thai Group Minor International - have been asked to cough up earnest deposit money which runs into hundreds of crores. Brookfield did not face this imponderable. After the failure of its corporate debt-restructuring plan in 2014, the Mumbai-based hospitality company transferred loans from 14 creditors to Nimesh Kampani-owned asset restructuring firm JM Financial ARC (JMARC).