JSW Group’s interest in acquiring a stake in JaypeeBSE 3.39 % Associates to bid for Jaypee InfratechBSE 0.28 % is likely to take a hit with the coming of the new ordinance that prohibits collaborations with defaulting promoters to bid for assets.
ET had reported on November 11 that JSW Group which has businesses ranging from steel to cement to infrastructure has shown “in-principle interest” in acquiring a stake in Jaypee Associates to bid for debt-ridden Jaypee Infratech. However, with the ordinance spelling out who cannot be a resolution applicant, the deal may not materialise.
“Any strategic collaboration with a defaulting promoter will be disqualified,” joint MD of JSW Steel, Seshagiri Rao told ET on the sidelines of the CII Manufacturing Summit held in Mumbai, not specifically wanting to comment on the proposed JSW-JAL deal.
Rao was echoing a term in the ordinance that said that those persons who “will be” promoters or in management of control of a wilfully defaulting corporate debtor during the implementation of the resolution plan are also ineligible as resolution applicants.
Homebuyers’ to the beleaguered company’s real estate projects have claimed JAL has diverted more than Rs 10,000 crore from the subsidiary which puts Jaypee under the scanner related to the above clause.
Earlier, chairman of the JSW Group, Sajjan Jindal had tweeted about how “dubious promoters” should not be allowed to bid for their own assets. It is then unclear why he would have shown interest in a company that could be tainted with acts of wrongdoing.
