Fair trade regulator CCI on Tuesday said it has given in-principle approval to mining conglomerate Vedanta's proposal to acquire debt-ridden Jaiprakash Associates, should it win a bid in the ongoing insolvency proceeding.
Apart from Vedanta, the proposals of Naveen Jindal-led Jindal Power, PNC Infratech, Adani Group and Dalmia Bharat for JAL acquisition have been cleared by the regulator.
"The proposed combination envisages acquisition of Jaiprakash Associates Ltd (JAL) by Vedanta Ltd (acquirer) pursuant to a corporate insolvency resolution process (CIRP) under the Insolvency and Bankruptcy Code, 2016," the regulator said in a release.
The Competition Commission of India (CCI) said it has approved the acquisition of Jaiprakash Associates Ltd (JAL) by Vedanta Ltd.
"Commission approves acquisition of Jaiprakash Associates Ltd by Vedanta Ltd," the regulator said in a post on X.
Following a recent ruling by the Supreme Court related to interpreting provisions of the Insolvency and Bankruptcy Code (IBC), an approval from the competition watchdog is mandatory for submission of a resolution plan by the entity concerned.
The entity must obtain the CCI nod before the resolution plan is voted upon by the Committee of Creditors (CoC) of the company undergoing the resolution process under the IBC.
The CoC of Jaiprakash Associates Ltd is still reviewing the resolution plans received, and the voting will be conducted in due course.
Vedanta is a subsidiary of Vedanta Resources Ltd. It is a natural resources, critical minerals, energy and technology company.
Last month, Vedanta beat Gautam Adani's Group to make a winning bid for the acquisition of debt-ridden Jaiprakash Associates (JAL) for Rs 17,000 crore, as per sources.
The bid value translates into Jaiprakash Associates' net present value of Rs 12,505 crore.
JAL, which has interests in real estate, cement, power, hotels and roads, has been dragged into insolvency proceedings after it defaulted on payment of loans, they said.
Lenders of JAL conducted a challenge process for the sale of the company under the IBC.
Multiple bidders participated in the process, but in the end, firm bids were placed by only two entities, Adani and Vedanta Group.
Vedanta eventually made a winning bid of Rs 17,000 crore, which translated into a NPV (net present value) of Rs 12,505 crore, beating Adani Group, sources said.
The Committee of Creditors (CoC) meeting was held on September 5 to conduct the challenge process.
Financial creditors have claimed a staggering Rs 57,185 crore in unpaid dues.
The National Asset Reconstruction Company Ltd (NARCL) leads the list of claimants after acquiring the stressed JAL loans from a consortium of lenders headed by the State Bank of India.
In April this year, as many as 25 companies showed interest in acquiring JAL.
However, in June, JAL announced that it has received five bids along with earnest money for the acquisition of the company through insolvency process.
Adani Enterprises, Dalmia Bharat Cement, Vedanta Group, Jindal Power and PNC Infratech had submitted bids to acquire JAL.
JAL was admitted to the corporate insolvency resolution process (CIRP) through the National Company Law Tribunal, Allahabad Bench, order dated June 3, 2024. It was taken to insolvency proceedings after the conglomerate defaulted on the payment of loans.
JAL has major real estate projects like Jaypee Greens in Greater Noida, a part of Jaypee Greens Wishtown in Noida (both on the outskirts of the national capital), and the Jaypee International Sports City, strategically located near the upcoming Jewar International Airport.
It also has three commercial/industrial office spaces in Delhi-NCR, while its hotel division has five properties in Delhi-NCR, Mussoorie, and Agra.
JAL has four cement plants in Madhya Pradesh and Uttar Pradesh, and a few leased limestone mines in Madhya Pradesh. The cement plants, however, are non-operational. It also has investments in subsidiaries, including Jaiprakash Power Ventures Ltd, Yamuna Expressway Tolling Ltd, Jaypee Infrastructure Development Ltd, and several other companies.
Jaypee Group's another company Jaypee Infratech Ltd has already been acquired by Mumbai-based Suraksha Group through insolvency process.
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