NEW DELHI: The lenders of Jaiprakash Associates Ltd (JAL), which is currently undergoing insolvency proceedings, will convene on Friday to initiate a ‘challenge process’ involving five bidders. This step aims to optimize the value of the distressed company’s assets.
The Committee of Creditors (CoC) is set to meet on September 5.
Among the bidders vying to acquire JAL are Adani Group, Dalmia Bharat, Vedanta Group, Jindal Power, and PNC Infratech.
Sources indicate that during a CoC meeting on August 22, it was decided to engage in further commercial negotiations with each Resolution Applicant to maximize the asset value of JAL.
A note has been circulated to facilitate the challenge process, which entails a bidding procedure aimed at identifying the highest committed financial proposal based on Net Present Value (NPV) for secured financial creditors.
The challenge process is expected to take place on Friday among the bidders, with a minimum bid value set at Rs 12,000 crore.
In this process, an original bidder presents an unsolicited bid to the auctioneer. Once approved, the auctioneer will solicit counter proposals against the original bid, ultimately selecting the best option available (including the original). After the challenge process concludes, the five bidders must submit final signed resolution plans that comply with the IBC and CIRP Regulations.
JAL entered the corporate insolvency resolution process (CIRP) as per the National Company Law Tribunal, Allahabad Bench, order dated June 3, 2024, after defaulting on loan repayments.
Creditors have claimed an enormous Rs 57,185 crore.
The National Asset Reconstruction Company Ltd (NARCL) leads the list of creditors after acquiring JAL’s stressed loans from a consortium of lenders headed by the State Bank of India.
JAL oversees major real estate projects, including Jaypee Greens in Greater Noida, a segment of Jaypee Greens Wishtown in Noida, and the Jaypee International Sports City, strategically located near the upcoming Jewar International Airport.
The company also has three commercial and industrial office spaces in Delhi-NCR, and its hotel division comprises five properties across Delhi-NCR, Mussoorie, and Agra.
In addition, JAL operates four cement plants in Madhya Pradesh and Uttar Pradesh and possesses several leased limestone mines in Madhya Pradesh, although the cement plants are not operational. The company holds investments in subsidiaries such as Jaiprakash Power Ventures Ltd, Yamuna Expressway Tolling Ltd, and Jaypee Infrastructure Development Ltd, among others.
