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New Delhi: Jaiprakash Associates Ltd. and Jaiprakash Power Ventures Ltd. on Monday announced plans to sell its cement business as well as some non-core assets to reduce debt. Both companies are part of Jaypee Groupwho is facing business barriers.
The companies’ decision to sell their cement business comes against the backdrop of a recent petition by country’s largest lender SBI to initiate insolvency proceedings against Jayprakash Associates Ltd (JAL), a flagship firm of Jaypee Group.
“In order to emphasize the Company’s ongoing efforts to reduce its debt, the Board of Directors at its meeting … decided to sell the significant cement business of the Company,” JAL said in a regulatory filing.
The Board of Jaiprakash Power Ventures Limited (JPVL) has also taken the “disinvestment decision of the Company”. Nigri Cement Grinding Unit as well as other non-core assets”, according to another regulatory filing.
Nigri Cement Grinding Unit, which is located near Jaypee Nigri Super Thermal Power Plant Singrauli in Madhya Pradesh has a capacity of 40 lakh tonnes per annum. Currently, 2 million tonnes per annum is in operation.
In September 2018, ICICI Bank filed an insolvency petition against JAL but the matter is still pending before the Allahabad Bench of the National Company Law Tribunal (NCLT).
Jaypee Group companies – Jaypee Infratech Ltd (JIL) and Andhra Cement – are already facing insolvency proceedings.
JIL went into insolvency in August 2017 after the NCLT accepted an application from the IDBI Bank-led consortium.
In June last year, Mumbai-based Suraksha Group had received approval from financial creditors and home buyers to acquire JIL. The NCLT has not yet approved the plan of protection.
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