Adani Enterprises Likely to Acquire Jaiprakash Associates Over Vedanta in Insolvency Deal

Adani Enterprises Ltd is likely to acquire Jaiprakash Associates Ltd (JAL) through a corporate insolvency resolution process, having submitted a superior resolution plan compared to its competitor, Vedanta Ltd. Sources indicate that Adani's offer, which proposes payment to lenders within two years, has been rated higher by the Committee of Creditors (CoC) than Vedanta's five-year payment plan. While Vedanta Group had initially emerged as the highest bidder in an earlier auction, negotiations led to revised plans, with Adani's now appearing more favorable. Dalmia Cement (Bharat) also submitted a plan, but its viability is reportedly contingent on a Supreme Court judgment.

The Committee of Creditors is expected to put the resolution plan to a vote within the next two weeks. Jaiprakash Associates Ltd, which defaulted on loans, has admitted financial claims of around ₹60,000 crore and affects over a thousand homebuyers. Its business interests are diverse, spanning real estate, cement manufacturing, hospitality, and engineering & construction, though some operations like its cement plants are currently non-operational. National Asset Reconstruction Company Ltd (NARCL) is a key claimant, having acquired stressed loans from lenders led by State Bank of India.

Impact: This acquisition could significantly boost Adani Group's presence in the real estate and cement sectors, potentially revitalizing JAL's distressed assets. For investors, it signals a major corporate restructuring and a move towards resolving a large insolvency case, which can improve sentiment for related sectors and highlight the value of distressed asset resolution. The successful resolution is crucial for financial creditors and homebuyers, potentially leading to recovery of dues and project completion. Rating: 7/10

Difficult terms: * Committee of Creditors (CoC): A group of a company's financial creditors (like banks) who have the authority to approve a resolution plan for a company undergoing insolvency. * Corporate Insolvency Resolution Process (CIRP): A legal framework in India for resolving insolvency issues of companies. * Net Present Value (NPV): The current value of future cash flows from a project or investment, discounted at a specific rate. It helps in comparing bids made at different times. * National Asset Reconstruction Company Ltd (NARCL): Often called "Bad Bank," it is set up to acquire stressed assets from banks to clean up their balance sheets. * YEIDA: Yamuna Expressway Industrial Development Authority, a government body that oversees development in the Yamuna Expressway region. * Erstwhile promoters: The previous owners or management of a company before it was taken over or went into insolvency. * 12A settlement: Refers to a provision under the Insolvency and Bankruptcy Code (IBC) allowing corporate debtors to settle their dues with creditors and withdraw the insolvency process.