NEW DELHI: The Competition Commission of India (CCI) announced on Tuesday that it has granted in-principle approval for mining giant Vedanta’s proposal to acquire the financially troubled Jaiprakash Associates, contingent upon winning the ongoing insolvency auction.
Besides Vedanta, the CCI has also approved acquisition proposals from Jindal Power, PNC Infratech, Adani Group, and Dalmia Bharat for Jaiprakash Associates.
“The proposed transaction involves the acquisition of Jaiprakash Associates Ltd (JAL) by Vedanta Ltd (the acquirer) as part of a corporate insolvency resolution process (CIRP) under the Insolvency and Bankruptcy Code, 2016,” stated the regulator in an official release.
The CCI confirmed its approval for Vedanta Ltd’s acquisition of Jaiprakash Associates Ltd (JAL).
“The Commission has approved the acquisition of Jaiprakash Associates Ltd by Vedanta Ltd,” the regulator shared on X.
A recent Supreme Court verdict regarding the interpretation of the Insolvency and Bankruptcy Code (IBC) has made it mandatory for competition regulatory approval before submitting a resolution plan by the interested entity.
The CCI’s approval is required before the resolution plan is voted on by the Committee of Creditors (CoC) of the company undergoing the resolution process under the IBC.
The CoC for Jaiprakash Associates Ltd is currently evaluating the received resolution plans, with voting scheduled to occur shortly.
Vedanta operates as a subsidiary of Vedanta Resources Ltd, focusing on natural resources, critical minerals, energy, and technology.
According to sources, Vedanta recently outbid Gautam Adani’s Group with a bid of Rs 17,000 crore to acquire debt-laden Jaiprakash Associates (JAL).
This bid reflects Jaiprakash Associates’ net present value at Rs 12,505 crore.
JAL, engaged in sectors including real estate, cement, power, hotels, and roads, entered insolvency proceedings after defaulting on loan payments.
Lenders initiated a challenge process for the sale under the IBC.
While multiple bidders participated, only two—Adani Group and Vedanta Group—submitted firm bids.
Ultimately, Vedanta’s successful bid of Rs 17,000 crore, amounting to an NPV of Rs 12,505 crore, surpassed Adani’s offer, as reported by sources.
A CoC meeting was held on September 5 to facilitate the challenge process.
Financial creditors have claimed a hefty Rs 57,185 crore in outstanding dues.
The National Asset Reconstruction Company Ltd (NARCL) is among the primary claimants, having purchased the distressed JAL loans from a consortium led by the State Bank of India.
Earlier this year, around 25 companies expressed interest in acquiring JAL.
By June, JAL confirmed receiving five bids along with earnest money for the acquisition via the insolvency process.
Bids were submitted by Adani Enterprises, Dalmia Bharat Cement, Vedanta Group, Jindal Power, and PNC Infratech.
On June 3, 2024, the National Company Law Tribunal, Allahabad Bench, admitted JAL to the corporate insolvency resolution process (CIRP) following the conglomerate’s loan payment defaults.
JAL oversees major real estate projects like Jaypee Greens in Greater Noida, portions of Jaypee Greens Wishtown in Noida, and the Jaypee International Sports City, which is strategically near the upcoming Jewar International Airport.
It also controls three commercial office spaces in Delhi-NCR and operates five hotels across Delhi-NCR, Mussoorie, and Agra.
Additionally, JAL has four cement plants located in Madhya Pradesh and Uttar Pradesh, alongside several leased limestone mines in Madhya Pradesh, although the cement plants are currently non-operational. It holds investments in various subsidiaries, including Jaiprakash Power Ventures Ltd, Yamuna Expressway Tolling Ltd, and Jaypee Infrastructure Development Ltd.
Another branch of Jaypee Group, Jaypee Infratech Ltd, has already been acquired by Mumbai-based Suraksha Group through an insolvency process.
