Kanakia Group Plans Realty Spin-off

Key Highlights

• Kanakia Group Seeks Demerger Approval: The group has applied to the NCLT Mumbai to separate its real estate arm, Kanakia Spaces Realty Pvt Ltd, from other business segments for strategic focus.
• Objective: Flexibility & Investment: The demerger aims to enhance financial resource-raising capabilities and attract more investors by streamlining business operations.
• Creditor Support Secured: Kanakia Spaces Realty has obtained consent affidavits from most unsecured creditors, indicating broad approval of the proposed scheme.

Kanakia Group has requested from the National Company Law Tribunal to greenlight the separation of Kanakia Spaces Realty Pvt Ltd and Transparent Developers Pvt Ltd.

It wants to spin off its real estate business from other parts of the firm. The group has submitted an application to the NCLT in Mumbai. It seeks to set aside the company’s entire real estate business from its other segments.

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The companies hope the scheme will bring greater flexibility for raising financial resources and say that it will help them attract more investors. At the recent hearing, the bench asked both Google and parent company Alphabet to provide details of contingent liabilities, any current legal disputes and thorough information about letters of credit, specifically what amounts have been sanctioned, used and the margin money paid on each of those credits.

The first company to apply (Kanakia Spaces Realty) has collected affidavits of consent from its unsecured creditors. The Kanakia Group says the majority of creditors have agreed to the proposed scheme.