Jaiprakash Associates Shareholders Face Estimated ₹400 Crore Loss Following Recent Development

Adani Enterprises Acquires Jaiprakash Associates Ltd Through ₹14,535 Crore Insolvency Resolution Plan

Key Developments:

• The National Company Law Tribunal (NCLT) has approved Adani Enterprises' ₹14,535 crore bid to acquire Jaiprakash Associates Ltd (JAL) through the insolvency process.
• The approval marks a crucial step in resolving JAL's long-standing financial stress under the Insolvency and Bankruptcy Code (IBC), 2016.
• Jaiprakash Associates Ltd's prevailing market capitalisation stands at around ₹404 crore.

Impact on Shareholders:

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• The resolution plan provides nil consideration and mandates the complete cancellation of existing shares, resulting in a total erosion of shareholder wealth.
• Shareholders will receive no payout as creditors take priority and recoveries fall short even for secured lenders.
• The entire existing shareholding structure of Jaiprakash Associates will be wiped out, including holdings of both public shareholders and promoters.

Resolution Plan Details:

• Adani Enterprises secured approval from creditors of Jaiprakash Associates Ltd for its ₹14,535 crore resolution plan to acquire the bankrupt infrastructure firm.
• The Adani Group received the highest support, securing 89% of the votes from creditors, ahead of competing bids from Dalmia Cement (Bharat) and the Vedanta Group.

Creditors and Shareholders Impacted:

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• 6,45,466 public shareholders will lose ₹404.68 crore, which is currently the total market cap (free float).
• The resolution plan further states that all existing share capital, including equity shares, preference shares, and any convertible or outstanding instruments, will be completely cancelled and extinguished.