NCLT-Chandigarh withholds merger of Embassy group firms with Indiabulls Real Estate

NEW DELHI: National Company Law Tribunal (NCLT)-Chandigarh bench has withheld the merger
of NAM Estates and Embassy One Commercial Property Developments (Embassy One) into Indiabulls
Real Estate (IBREL), the company informed in a BSE filing.
It is pertinent to note that the merger already stands sanctioned by the NCLT-Bengaluru bench, which has
jurisdiction over NAM Estates and Embassy One, on April 22, 2022. However, the NCLT-Chandigarh
bench, which has jurisdiction over IBREL, had earlier raised certain concerns based on the objections
cited by Income Tax department to the merger, the company said in the regulatory filing.

Jitu Virwani, chairman, Embassy Group expressed his disappointment at the decision and said, “We have
provided all the necessary details and clarifications sought by the NCLT regarding the details of NAM
Estates and Embassy One and have also meticulously addressed the objections cited by the Income Tax
department, including giving an undertaking that any past tax issues will be borne by Embassy Group and
not by the public shareholders of IBREL. However, the NCLT has taken an extreme step of not approving
the merger.”
“IBREL strongly believes that these objections and concerns were unfounded, unjustified and do not
impact the merger in a significant manner and had accordingly addressed the same before the NCLT. The
company will await the detailed order to further evaluate the next steps and shall explore all options,
including filing an appeal against the order of the NCLT-Chandigarh bench, before the National Company
Law Appellate Tribunal (NCLAT) at the earliest,” it said in the regulatory filing.

The merger has already received support from 99.9987% of its shareholders who voted on the same and
has also received approval from other regulators. In February 2021, the Competition Commission of India
(CCI) approved the proposed merger.
Embassy Group said that it remains the largest shareholder in IBREL and is committed to the creation of
one large platform and will explore all possible options at this stage. “IBREL’s board shall be meeting
over the next day to chalk out its plan and strategy to move forward and shall communicate the same to
all its stakeholders,” it informed in the regulatory filing.

In August 2020, NAM Estates and Embassy One Commercial Property Developments (NAM Opco),
subsidiaries of the Embassy Group, had entered into definitive merger agreement to amalgamate their
ongoing, completed & planned residential and commercial projects with Indiabulls Real Estate.
The resultant listed is to be owned about 44.9% by Embassy Group, 26.2% by the existing public &
institutional shareholders, 9.8% by existing IBREL promoter group and about 19.1% by BREP & other
Embassy institutional investors.
The combined IBREL entity, if approved, will be renamed Embassy Developments and will be coheadquartered in Mumbai and Bengaluru. It has 80.8 million sq ft of launched and planned development
potential..