IFCI takes Emaar MGF to Delhi HC

IFCI Ltd has taken real estate major Emaar MGF to the Delhi High Court for not refunding it Rs 50 crore that it had given to the latter in a pre-IPO placement.
Stating this, an IFCI executive said the company had no option but to take legal recourse to recover the money it had paid to Emaar MGF.
“We do not know when and how the Rs 50 crore will be returned to IFCI and whether interest will be paid or not. There has been no communication from Emaar MGF in this regard,” the executive claimed.
When contacted, Emaar MGF said they are not aware of any such development. However, sources close to the company said, “As per information available, Emaar MGF had offered IFCI to buy back the shares a long time back at the same value as the pre-IPO placement. However, IFCI is demanding interest on the same, which is contractually not permissible. Hence, the dispute.”
Emaar MGF had withdrawn its proposed over Rs 6,000 crore maiden public issue in February 2008 due to volatility in the stock market.
The IFCI official added that the allotment price of Emaar MGF shares would have been the same as that of the IPO allotment price.
“The IPO was called off, so there was no share allotment to us. We have waited for some months before moving the Delhi High Court last month to recover the money,” the executive added.
Real estate company Emaar MGF is a joint venture between Emaar Group of Dubai and Delhi-based MGF Ltd, with the latter holding 53 per cent in the company.
Recently, Emaar decided to invest $150 million in three special purpose vehicles for retail and commercial property development in Gurgaon and Mohali.
BS Reporters / New Delhi July 24, 2008, 12:25 IST
http://www.business-standard.com

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