CCI Grants Approval for Strategic Cement Acquisition
Dalmia Cement (Bharat) Ltd, is approved by the Competition Commission of India (CCI) for the proposed acquisition of Jaiprakash Associates Ltd (JAL). This will be one of the significant resolution plans in the ongoing insolvency proceedings of JAL.
JAL is a diversified conglomerate that operates in multiple industries, including cement, real estate, hospitality, and EPC services, that entered into corporate insolvency resolution process (CIRP) on June 3, 2024. The CCI approval is important for the whole process of resolution but ultimately the creditors will have to choose the final resolution plan among multiple bidders.
In a press statement, the CCI said the transaction involves the 100% acquisition of JAL by Dalmia Cement under the framework of the Insolvency and Bankruptcy Code, 2016. A detailed order is expected to follow.
Dalmia Cement is a wholly-owned subsidiary of Dalmia Bharat Ltd (DBL), the parent company of the Dalmia Bharat Group. DBL is one of India’s largest cement manufacturers with a strong pan-India presence.
While Dalmia has received CCI clearance, other competing bids, including Adani Group’s, are under regulation. Other bidders in the fray include the Vedanta Group, Jindal Steel & Power Ltd (JSPL), and PNC Infratech.
Sources familiar with the matter indicate that lenders have asked all prospective resolution applicants to resubmit revised bids, free from any conditionalities and with firm financial commitments. The outcome of these bids, however, may hinge on the resolution of a critical legal dispute involving JAL’s 1,000-hectare Sports City project in Greater Noida.
In March, the Allahabad High Court upheld Yeida’s (Yamuna Expressway Industrial Development Authority) decision to cancel the land allotment for the project. The case is currently pending before the Supreme Court.
A recent Supreme Court ruling has made it mandatory for resolution applicants to obtain CCI approval before approaching the CoC. Nonetheless, it is believed that Ministry of Corporate Affairs is mulling various amendments to the lnsolvency and Bankruptcy Code to clarify that, in respect of submission of resolution plans under the CIRP, prior approval from CCI may not be warranted.
The next few weeks could be significant, as regulatory, judicial, and creditors decisions converge to determine the future of the beleaguered Jaiprakash group.
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