Vedanta Confirms Power Business is Top Target in Jaiprakash Associates Acquisition

Energy

31st October 2025, 7:25 PM

Vedanta Confirms Power Business is Top Target in Jaiprakash Associates Acquisition

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Stocks Mentioned :

Vedanta Limited

Jaiprakash Associates Limited

Short Description :

Vedanta, the highest bidder with an offer of ₹17,000 crore, has identified Jaiprakash Associates' power business as its most attractive asset. Vedanta's Executive Director Arun Misra stated that acquiring this business aligns with their strategy to reach 3,000 MW of power production in India. The Competition Commission of India has approved Vedanta's bid, though other entities, including the Gaur family and Kotak Alternate Assets, have also made bids, potentially complicating the acquisition process.

Detailed Coverage :

Vedanta Limited is aggressively pursuing the acquisition of assets from the debt-laden Jaiprakash Associates, with its power business being the primary focus. Vedanta's executive director, Arun Misra, highlighted that this power segment perfectly fits their strategic goal to expand power production to at least 3,000 MW in India, complementing their existing power assets linked to their aluminium and zinc operations. Vedanta has emerged as the highest bidder, offering ₹12,505 crore in net present value, which includes a ₹4,000 crore upfront payment, with the total offer reportedly valued at ₹17,000 crore. The Competition Commission of India has already given its nod for Vedanta's bid. While other assets like cement and real estate are subject to further investigation regarding their synergy with Vedanta's broader economic activities, the power component is deemed most crucial for their strategic roadmap.

Vedanta's current power business contributes over 5% to its consolidated revenue and around 2% to its Ebitda. However, the deal faces potential complications. Kotak Alternate Assets has made a significant bid of ₹7,400 crore for Jaiprakash Power Ventures' preference shares and debt, and the Gaur family, promoters of Jaiprakash Associates, has also re-entered the race with a higher offer of ₹18,000 crore. Despite these challenges, Vedanta remains optimistic about securing the acquisition.

Impact: This acquisition could significantly boost Vedanta's presence in the Indian power sector, potentially leading to increased operational capacity and revenue. It also signifies a major consolidation move in the infrastructure and energy space, impacting competitors and market dynamics. The deal's successful completion would strengthen Vedanta's integrated business model. Rating: 8/10

Difficult Terms: Net Present Value (NPV): A calculation used to determine the current value of future cash flows, adjusted for the time value of money. It helps in assessing the profitability of an investment. Ebitda: Earnings Before Interest, Tax, Depreciation, and Amortization. It is a measure of a company's operating performance. Compulsorily convertible preference shares: A type of preference share that must be converted into ordinary shares by a certain date.