Jaiprakash Associates: Crucial Committee of Creditors meeting slated for January 17 re-scheduled
The much anticipated meeting of Committee of Creditors (CoCs) of crisis-ridden Jaiprakash Associates Ltd (JAL) slated for Friday now stands re-scheduled, according to the company’s filings with stock exchanges.
“In continuation to our intimation dated 14th January, 2025, we wish to inform that the meeting of Committee of Creditors of the Company which was scheduled to be held on January 17, 2025 is now being re-scheduled,” JAL’s filing with the bourses said.
“The re-scheduled date for the 8th CoC meeting will be communicated later”, it added.
The reasons for re-scheduling was, however, not disclosed.
Jaypee’s Resolution Professional remained unavailable for comments.
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The CoC meeting was crucial as it was expected to give nod for the State-owned National Asset Reconstruction Co Ltd’s (NARCL) sole bid worth ₹12,000 crore to take over the distressed debt that JAL owed to nearly 25 lenders.
NARCL’s proposal was for a settlement at ₹12,000 crore, with the offer including an upfront cash payment of 15 per cent and security receipts of 85 per cent.
Process advisor IDBI Capital Markets & Securities (ICMS) had extended the deadline by a week to January 14 to attract rival bids, but none materialised, making NARCL the preferred bidder for JAL, sources confirmed.
While over half-a-dozen asset reconstruction companies (ARCs) initially expressed interest in acquiring lenders’ exposure to JAL on an all-cash basis, no firm offers were received to challenge the government-backed bad loan aggregator.
Jaiprakash Associates has admitted claims totalling ₹52,073.79 crore under the Insolvency and Bankruptcy Code (IBC).
According to one of the lenders, Swarup Kumar Saha, Managing Director & CEO of Punjab & Sind Bank, the resolution for JAL is likely to happen within this quarter (March 2025). “As a bank we are happy that the resolution is happening and we expect substantial recovery in this account. We are getting more than what we were anticipating,” he had told businessline recently. He, however, declined to go into the exposure amount.
Post NARCL entering into the fray, State Bank of India — JAL’s lead lender — had invited counter-bids under the Swiss challenge auction. Sources said NARCL’s offer was the reserve price for the auction. And counter-bids were invited on a full-cash basis including a mark-up of ₹600 crore. So any entity submitting a counter-bid would actually need to place offers of ₹12,600 crore or above, with the payment being made in cash.
Some of the lenders with high exposure to the company include SBI with nearly ₹15,500 crore, ICICI Bank – ₹10,000-odd crore, IDBI Bank – ₹8,700 crore, Axis Bank – ₹3000 crore, among others. Other lenders include Punjab & Sind Bank, Standard Chartered, LIC, Indian Overseas Bank, etc.
