Latest news with #ResolutionPlan
Mint
3 days ago
- Business
- Mint
Adani Power adds Reliance Power's former unit to its string to acquisitions
Adani Power Ltd has inched closer to acquiring the bankrupt Vidarbha Industries Power Ltd, a former subsidiary of Reliance Power Ltd, adding to a list of distressed but strategically located power assets as it strives towards its goal. The National Company Law Tribunal on 18 June approved Adani Power's ₹4,000 crore resolution plan to acquire VIPL following a majority nod in February by the distressed company's committee of creditors. Adani Power aims to increase its 17.55 GW of power-generating capacity—including thermal plants across states and a 40 MW solar project in Gujarat—to 30.67 GW by 2030, making it the largest private sector capacity expansion in the country. With its latest acquisition, Adani Power will gain control of VIPL's 600 MW thermal power plant in Butibori, Nagpur, comprising two 300 MW units. The plant has a long-term power purchase agreement with the Maharashtra government for 308.5 MW, ensuring stable cash flows and potential for future scale-up. The VIPL deal follows Adani's recent acquisitions of Dahanu Power ( ₹815 crore), Lanco Amarkantak Power, and Coastal Energen ( ₹3,330.88 crore), underscoring the group's strategy to drive growth. On Thursday, 19 June, Adani Power shares fell 3.2% to ₹533.20 each on NSE, while the Nifty 50 held steady, shedding just 18.80 points amid geopolitical tensions because of the escalating Israel-Iran conflict. Also read | Adani Group to raise ₹2.5 trillion over five years to fund capex VIPL's insolvency Vidarbha Industries Power was admitted into insolvency in September 2024 after CFM Asset Reconstruction moved the tribunal under the Insolvency and Bankruptcy Code (IBC). On 24 February this year, Adani Power informed stock exchanges that VIPL's lenders had approved its revival plan, subject to the terms of the letter of intent and necessary regulatory approvals. Adani Power had emerged as the successful resolution applicant after a competitive process that attracted bids from several major players, including Capri Global Holdings, CESC Ltd, Hindustan Thermal Projects, Jindal Power, JSW Energy, NTPC Ltd, Orissa Metaliks, Vedanta Ltd, and Shriniwas Spintex Industries. Under the approved plan, Adani Power will pay ₹4,000 crore against total admitted liabilities of ₹6,753 crore. The Adani entity has been directed to complete the payment within the stipulated timeframe. 'The Resolution Applicant is directed to make payment of the entire Resolution Plan amount within the time period stipulated under the Resolution Plan, failing which the entire amount paid shall stand forfeited," a Mumbai bench of the NCLT said in its 18 June order. As per the plan, the funding will be arranged through internal accruals or financing by eligible affiliates, with the flexibility to raise capital via equity, debt, preference shares, or external commercial borrowings. Also read | Adani, Reliance among participants in NPCIL's small nuclear reactor project Reliance Power's exit VIPL was originally established as a special-purpose vehicle by Reliance Power to develop a 600 MW thermal power plant in Butibori, Nagpur, under a concession from the Maharashtra Industrial Development Corporation. The project was later converted into an independent power project. In September 2024, Reliance Power announced that VIPL was no longer its subsidiary after settling ₹3,872 crore in corporate guarantees extended on its behalf. As part of the settlement with CFM Asset Reconstruction, all associated obligations were released and 100% of VIPL's shares were pledged in favour of CFM. VIPL had defaulted on loans from Axis Bank and State Bank of India, which were later acquired by CFM ARC. Also read | Is the Israel-Iran war a billion-dollar threat to Adani Ports & SEZ?
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Business Standard
09-05-2025
- Business
- Business Standard
Ex-promoter of Bhushan Power moves NCLT to enforce SC's liquidation order
Sanjay Singhal, the former promoter of Bhushan Power & Steel Ltd, has filed a petition with the National Company Law Tribunal in New Delhi to seek enforcement of the Supreme Court's recent order directing the bankrupt company's liquidation. Singhal, in a petition dated May 6, asked the NCLT to take on record the court order and give directions to appoint a liquidator. 'Business Standard' has reviewed the petition. The court on May 2 rejected JSW Steel's resolution plan to acquire Bhushan Power four years after the takeover was completed, and ordered the liquidation of the debt-ridden firm. The order revived a years-long insolvency litigation and is a setback for lenders. Bhushan Power owes lenders more than Rs 47,200 crore and it was among the 12 companies first sent for debt resolution by the Reserve Bank of India in 2017 under the Insolvency and Bankruptcy Code, 2016 (IBC). The court's order sets the stage for a long legal battle in which lenders and JSW Steel are expected to fight for their interest. The Supreme Court said JSW Steel had not disclosed that it had a joint venture with an entity linked to Bhushan Power's former promoters. Resolution professional Mahender Kumar Khandelwal did not flag this fact and failed in his statutory duties under Section 25 of the IBC, including verifying the eligibility of the resolution applicant under Section 29A. Section 29A disqualifies former promoters and their related parties of the corporate debtor, as well as certain other individuals, from participating in the revival of a distressed company. 'It is pertinent to note that in the 14th Meeting of the committee of creditors (CoC), it was specifically brought to the notice of the CoC by the legal counsel of the resolution professional that the resolution plan of the JSW was subject to the compliance of Section 29A. However, in the later meetings there was no clarity made as to whether the JSW had subsequently complied with the said requirement or not. Even if it is believed that JSW had filed an affidavit with regard to its eligibility to submit the Resolution Plan, there is nothing on record to show as to whether such affidavit was verified by the resolution professional as he was obliged to do so,' said the court.
Indian Express
05-05-2025
- Business
- Indian Express
Bhushan Power saga: Why did Supreme Court reject JSW Steel takeover bid and order liquidation?
The Supreme Court on Friday rejected steel major JSW Steel Ltd's Rs 19,350 crore bid to acquire Bhushan Power and Steel Ltd (BPSL) through the Corporate Insolvency Resolution Process (CIRP) route, and ordered the liquidation of the company. While ordering the liquidation, the biggest in the corporate history, a bench of Justice Bela Trivedi and Justice Satish Chandra Sharma lambasted the delay on the part of JSW Steel to implement the resolution plan and said the Committee of Creditors (CoC) failed to exercise its commercial wisdom while approving the Resolution Plan. JSW Steel, controlled by Sajjan Jindal, and lenders are likely to go for appeal against the SC order as both the parties will suffer a setback if liquidation of BPSL is implemented. First big deal to face liquidation The liquidation of BPSL is set to be the biggest in the history of the corporate sector in terms of the size of the debt. Supreme Court of India earlier ordered the liquidation of Jet Airways, a once prominent Indian airline, due to the failure of a resolution plan and the inability of the Jalan-Kalrock Consortium (JKC) to fulfil its financial obligations. While Jet Airways was estimated to have owed its financial creditor around Rs 7,800 crore, a total of around Rs 15,723 crore was admitted as claims by the National Company Law Tribunal when the airline was first grounded in 2019. The number of cases ending in liquidation in FY24 was 2,476 involving total claims of Rs 11 lakh crore, according to Insolvency and Bankruptcy Board of India (IBBI). However, the liquidation value is just Rs 69,634 crore, just 6.33 per cent of admitted claims. SC censures delay by JSW SC said JSW even after the approval of its plan by the NCLAT, wilfully contravened and not complied with the terms of the said approved Resolution Plan for a period of about two years, which had frustrated the very object and purpose of the IBC, and consequently had vitiated the CIR proceedings of the corporate debtor-BPSL. 'In the instant case, JSW did not implement the Resolution Plan for about two years since its approval by the NCLAT, though there was no legal impediment in implementing the same. Such flagrant violation of the terms of the Resolution Plan, has frustrated the very object and purpose of the Code,' the Supreme Court said. After obtaining the approval of its Resolution Plan from CoC by presenting a rosy picture, misguiding the CoC, and defeating the rights of other resolution applicants, JSW did not respect and honour the said commitments, the SC said. On the contrary, it tried its level best to delay the implementation of the Resolution Plan without any cogent reason or justification, the order said. Though the said plan was got approved from the NCLT by the Resolution Professional (who was overseeing the resolution process) without confirming the compliance of Section 30(2) and the Regulations 38 and 39, JSW instead of complying with the terms and clauses of the approved Resolution Plan filed the company appeal before the NCLAT, just to delay the implementation of the Plan, the order said. 'This is nothing but a misuse of process of law and a fraud committed by JSW with the CoC and other stakeholders,' the order said. JSW played smart, SC says According to SC, it is pertinent to note that though all throughout from the date of order passed by the NCLT till March, 2021, the stand of the JSW evidenced through an affidavit was that it was not obliged to implement the plan because of the pendency of these appeals. However, JSW played smart by making part payment to the financial creditors in March, 2021, realising the beneficial market trend of the steel, it said. It also surreptitiously got the effective date extended to March 31, 2021 from the so-called core group of CoC, which had already become functus officio and which had no authority to extend the said effective date, the court said. The net result is that the upfront payments as agreed to be made in the Resolution Plan within 30 days of the approval of the plan by NCLT was delayed by 540 days in respect of payment to the financial creditors and by 900 days in respect of payment to the Operational Creditors. 'The equity commitment as per clause 2.3 of the Resolution Plan with regard to the infusion of equity into the company for an amount aggregating Rs 8,550 crore, to be infused upfront on the effective date, was also not complied with by JSW,' the order said. SC criticises lenders committee, RP The Supreme Court said the Committee of Lenders (CoC) had failed to exercise its commercial wisdom while approving the Resolution Plan of the JSW, which was in absolute contravention of the mandatory provisions of IBC and CIRP Regulations. The CoC also had failed to protect the interest of the creditors by taking contradictory stands before the court, and accepting the payments from JSW without any demurer, and supporting JSW to implement its ill-motivated plan against the interest of the creditors, SC said. The Resolution Professional (RP) had utterly failed to discharge his statutory duties contemplated under the IBC and the CIRP Regulations during the course of entire CIR proceedings of the corporate debtor (BPSL), SC said. 'Just as the Resolution Professional had failed to examine and confirm the compliance of mandatory provisions of the Code, to secure the interests of all the stakeholders involved in the process, the CoC also did not discharge its duty to carefully examine the feasibility and viability of the plan, and the capacity and resources of the Resolution Applicant-JSW for the implementation of the plan proposed by it,' SC said. There was a dishonest and fraudulent attempt made by JSW, misusing the process of the court by not making the upfront payments as committed by it for about two and a half years and thereby enriching itself unjustly, and thereafter considering the rising prices of steel in the market, JSW sought to comply with the terms of Resolution Plan at a very belated stage, in collusion with the CoC and the Resolution Professional, SC said. What it means for JSW BPSL which came under the JSW fold in 2021 has been contributing to JSW's revenue and profit. The BPSL plant made a profit of Rs 11 crore in third quarter of FY25, loss of Rs 93 crore in Q2 of FY25 and a profit of Rs 300 crore in Q1. JSW is likely to face a decline of around 8-10 per cent in EBITDA (earnings before interest, tax, depreciation and amortisation) and revenue for FY26 if BPSL is liquidated, said an analyst. Further, JSW will have to recover Rs 19,300 crore given to the lenders if the liquidation is implemented. BPSL had expanded (Phase-II) of its plant from 3.5 MTPA to 5 MTPA. BPSL is a leading manufacturer of flat and long products and has state-of-the-art plants at Chandigarh, Derabassi, Kolkata and Odisha in India. Options before JSW, BPSL Liquidation means end of the road for BPSL. When BPSL is liquidated, its assets are sold to settle debts, often at distressed prices, leaving less money for banks. This could result in significant losses for lenders, who have already taken a huge haircut. The unwinding of this transaction is expected to have far-reaching consequences for the banking sector and IBC cases. However, JSW Steel and lenders are likely to go for an appeal against the SC order on liquidation, banking sources said. The court battle is expected to continue as JSW and lenders have odds stacked against them. 'We are yet to receive the formal copy of the order to understand the grounds for rejection in detail and its implications. Once we receive the order and are able to review the same along with our legal advisors, we will decide on our further course of action,' JSW Steel said in a stock exchange filing on Friday. A senior bank official with a nationalised bank said banks are studying the SC order. 'There could be some appeals against the SC verdict. There's a possibility that JSW might also appeal against the order,' he said. With the company going into liquidation, banks are unlikely to recover much, potentially leading to further losses. Four-year process Bhushan Power, which was the top bank defaulter listed by the Reserve Bank of India (RBI), which went through the insolvency process under IBC, was acquired by JSW Steel after a four-year long process. The petition filed by the Punjab National Bank (PNB) against the company was admitted on July 26, 2017 and CIRP was initiated. It took 771 days to complete the resolution process, with JSW steel Limited becoming the successful resolution applicant, as National company law tribunal (NCLT) approved the resolution plan on September 5, 2019 and the National Company Law Appellate Tribunal (NCLAT) upheld JSW's resolution plan. After a two-year delay, JSW finally acquired BPSL in March 2021 under the Insolvency and Bankruptcy code. Original resolution plan According to the resolution plan, the financial creditors were to be paid upfront a sum of Rs 19,350 crore on pro-rata basis against the admitted claims of Rs 47,157.99 crore. Accordingly, the resolution plan provided for a recovery of Rs 41.03 per cent to the financial creditors. As far as operational creditors are concerned, the resolution plan provided for the payment of 47.69 per cent of their admitted claims of Rs 621 crore. No claims were received from workmen/employees and other creditors. Apart from JSW Steel, Tata Steel limited (TSL) and Liberty House group had also submitted the resolution plan.
The Hindu
02-05-2025
- Business
- The Hindu
Supreme Court rejects JSW Resolution Plan for Bhushan Steel
The Supreme Court, in a judgment on Friday (May 2, 2025), rejected the Resolution Plan submitted by JSW Steel for Bhushan Steel and Power Ltd. Also Read | ED restitutes assets worth ₹4,025 crore in Bhushan Power and Steel case to JSW The National Company Law Appellate Tribunal had previously approved the Resolution Plan. A Bench headed by Justice Bela M. Trivedi found the plan contrary to the provisions of the Insolvency and Bankruptcy Code (IBC). A copy of the judgment is yet to be published on the Supreme Court website. In a statement, a JSW Steel spokesperson said they have 'learnt that the Hon'ble Supreme Court pronounced judgment on May 2 rejecting the Resolution Plan approved by NCLAT on certain grounds'. 'We are yet to receive the formal copy of the Order to understand the grounds for rejection in detail and its implications. Once we receive the order and are able to review the same along with our legal advisors, we will decide on our further course of action,' the statement said. The court faulted the Committee of Creditors (CoC) for accepting the Resolution Plan. The court further directed the National Company Law Tribunal to initiate liquidation proceedings against Bhushan Steel and Power Ltd. Justice Trivedi, who pronounced the judgment, said the Resolution Professional had failed to perform his statutory duties during the corporate insolvency resolution process, as mandated under the IBC and its associated regulations. The Bench said the CoC was found to have approved the Resolution Plan without proper application of its commercial wisdom. The plan had contravened mandatory IBC provisions and did not protect creditors' interests and notably, the CoC accepted payments from JSW without objection, despite the plan's shortcomings, the court observed.
Hindustan Times
24-04-2025
- Business
- Hindustan Times
Max Estates takes over stalled Delhi One project in Noida; to invest ₹1,400 crore for completion of the project
Max Estates has taken over the stalled 'Delhi One' project in Noida through the insolvency route and is expected to invest close to ₹1400 crore to revive the project after seven years, the company said in a regulatory filing. The company said in a regulatory filing that it has taken over 'Boulevard Projects Private Limited (BPPL)' to revive Delhi One project in Noida, after a seven years of wait. 'The company is acquiring the Delhi One Project pursuant to a Resolution Plan, and the total capital commitment, including settlement of outstanding liabilities, is estimated to be ₹1,400 crores," the company said. This strategic acquisition offers a significant development potential of approximately 2.5 million square feet, inclusive of already sold units. The project is expected to generate a total sales potential of approximately ₹2,000 crores, along with an annuity rental income potential of around ₹120 crores, it said. The acquisition is in line with the company's strategy to expand its real estate portfolio, specifically for the development of the Delhi One mixed land use project under BPPL in Sector 16B, Noida . The business is within the main line of business of the company, it said. Max Estates said it has successfully completed the acquisition of 100 per cent equity share capital of Boulevard Projects Pvt Ltd by way of allotment of 34,000 fresh equity shares to the company and its nominees, effective April 23, 2025, it said. Max Estates had received final approval from NCLT and NCLAT on February 2023 and October 2024, respectively, it said. Delhi One is an integrated mixed-use development that will host ultra-luxury serviced residences, premium office spaces, curated retail and an exclusive club. Max Estates Limited (Max Estates), a real estate developer in the NCR, has received the final approval from the National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) in February 2023 and October 2024 and now with the successful closure, Max Estates has taken over the Delhi One Project, the company said in a statement The project is located at the edge of South Delhi and directly connected via the Delhi-Noida-Direct (DND) Flyway, the development is just steps from key metro stations, benefitting from unparalleled connectivity across Delhi NCR. The project spans approximately 2.5 mn sq. ft. of development, part of around 10-acre land parcel constituting around 34,696 sq m area. 'We are delighted to announce that Max Estates has taken over Delhi One. We believe that we will provide a world class real estate experience to the residents and office goers of the NCR. We look forward to bringing to life our first integrated campus, weaving Max Estates' philosophy of LiveWell, WorkWell, PlayWell, and EatWell into a holistic downtown experience,' said Sahil Vachani, vice chairman and managing director, Max Estates.
