The resolution professional of debt-ridden Jaiprakash Associates Ltd (JAL) told the National Company Law Appellate Tribunal (NCLAT) that there has been no formal declaration identifying Vedanta as the highest bidder in the insolvency process, according to court submissions.
Senior Advocate Abhishek Manu Singhvi, appearing for the Resolution Professional (RP) said an e-mail dated September 5 circulated to all bidders only conveyed the highest financial value discovered during the challenge process, and did not constitute an official declaration of a successful bidder.
He alleged that Vedanta’s claim of being the highest bidder amounted to “suppression of material facts,” arguing that its petition lacked a legal and factual basis. Singhvi further told the tribunal that the case presented by the mining group was “completely without foundational facts.”
“It is a perfectly simple, valid e-mail pointing out what will happen in future. When you do this, then we will evaluate. It’s very simple and straightforward,” he said during the proceedings of the appellate tribunal.
Singhvi said the e-mail does not say that Vedanta is the highest bidder.
A two-member NCLAT bench observed that the e-mail “only communicates that the highest value as per the identifying criteria is Rs 12,505 crore on NAV basis…”
Replying to it, Singhvi said this is only a disclosure that the highest NAV (Net Asset Value ) was shown as Rs 12,505.850 crore.
“I cannot prevent what you think. But you cannot start thinking that this is a declaration of the best. It is a disclosure that you have a Rs 12,000 crore NAV. Now, if you start imagining things in your favour, then it is not my problem,” he said questioning, “why nobody else misunderstood it”?
Vedanta has submitted that its bid was above NAV.
Singhvi further said the Committee of Creditors evaluated plans on a combined quantitative and qualitative matrix, not just on the highest NPV or headline bid amount.
Vedanta, in its two petitions challenging the lenders’ decision to accept Adani’s takeover offer, had contended that its addendum bid is about Rs 3,400 crore higher in gross value terms and roughly Rs 500 crore more in net present value (NPV) compared with the Adani Group’s offer.
Singhvi said it was decided based on a total score of 100, in which the quantitative score was 80 and rest 20 was of qualitative score.
This parameter was not made for Adani or Vedanta, but this evaluation matrix has been followed in several cases. This is known as a holistic evaluation, not a unifocal evaluation on a single parameter and it is always better to have this, he said.
Over Vedanta claims for not giving any chance to match Adani bid, Singhvi while reading the terms and conditions before NCLAT, said the challenge process barred any post-closure revision.
He further said Vedanta’s November 8 addendum was an impermissible unilateral revision. After being informed on November 7 that voting would proceed, the appellant tribunal submitted a revised addendum on November 8, which was contrary to the agreed rules.
“Allowing such a revision would violate fairness and level playing field. If one applicant were allowed to revise after closure, all applicants would have to be given the same chance, defeating finality of the process.
He also stressed that the commercial wisdom of COC is not open to re-evaluation.
After the conclusion of RP’s arguments, the bench, comprising Chairperson Justice Ashok Bhushan and Member (Technical) Barun Mitra has posted the matter for the next hearing on Monday.
Solicitor General Tushar Mehta, who is appearing for banks, will start his arguments from Monday.
Vedanta has filed two petitions, challenging the March 17 order by the Allahabad bench of NCLT, which approved Adani Enterprises’ Rs 14,535-crore bid to acquire JAL through the insolvency process.
On March 24, NCLAT declined any interim stay on the order passed by the NCLT approving the Adani Group’s bid for acquiring JAL.
However, it said the plan would be subject to the outcome of the appeals filed by the Anil Agarwal-led Vedanta Group.
This interim order by NCLAT was challenged before the Supreme Court, which also declined to grant a stay. However, the apex court had directed that if the monitoring committee planned to take any major policy decision, it should first obtain the tribunal’s sanction.
Source: Economic Times