It keep on showing VM could not initialize < VM Guid > and "failed to set/change partition property" in event viewer.
After an hour of googling found a KB 2517374 article with reference about Intel AVX technology in Sandy bridge processors and some interesting stuff from Jeff Woolsey's Chicken and egg case.
The base funda is Intel's sandy bridge processors were released after the release of Windows Server 2008 R2 RTM, so it doesn't contain the bits to leverage new bells and whistles. As there is a slight change in processor architecture itself, it refuses to start the virtual machines.
Either upgrade to Service pack 1 to make use of Intel AVX in host and guest or install the above mentined hotfix to disable the AVX for the guest OS's
Upgrade to service pack 1 and enjoy the power of AVX(high performance floating point calculations) in both of your guest and host.