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Earlier, we at Jobaaj had reported about external reports which stated that the Adani Group was holding advanced talks with the Jaypee Group for its cement business. However, the same reports have been rendered moot by the group as it denied the facts stated in them.
These rumors began last week as certain reports stated that the Adani Group was actively looking to acquire the distressed group's cement business. The Adani Group had recently completed the acquisition of Holcim India's stake in Ambuja and ACC & announced its plans to improve its existing capacity by 100% by 2030.
Moreover, a separate announcement by the Board of Jaiprakash Associates which stated their intent to divest their cement business (without mentioning the details of any interested buyers) gave traction to the news as the acquisition seemed fairly plausible.
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"The company is not evaluating any such proposal and hence we are not in a position to comment on the veracity of said media report," the Adani Group announced in a stock exchange filing.
Moreover, the company has also disclosed that it would responsibly disclose any developments of a similar nature and comply with all regulatory requirements. The acquisition would've assisted the Adani Group in further consolidating its position as India's second-largest cement producer.
However, this is a greater shock to the Jaypee Group and two of its companies: Jaiprakash Associates and Jaiprakash Power Ventures. This deal, worth around Rs 5,000 crores would've assisted the company to reduce its debt significantly. Since there have been no reports suggesting the submission of EoIs for their cement business, a resolution of its looming debt seems far off.
Moreover, when these false reports began circulating, the stock of Jaiprakash Associates surged over 10% as investors were hopeful of the company's future. However, following the clarification, the stock tanked.
It declined around 19% in 2 to touch a low of Rs 9.50 per share. It currently trades at around Rs 10.35 per share.
Article by Aman Agarwal.
This news piece is brought to you in association with Jobaaj.com
