Kumar Mangalam Birla-led UltraTech has called off a
Rs.5400-crore deal to buy Jaypee Group’s 2.1 mtpa cement plant in Madhya
Pradesh as new MMDR Act 2015 barred transfer of mines not allocated
through auctions
.
UltraTech was forced to call off
the deal after the Bombay High Court refused to approve the scheme of
arrangement entered between UltraTech Cements and Jaiprakash Associates
(JAL), for acquisition of entire cement business along with mining
rights situated at Bela and Siddhi in Madhya Pradesh.
The Bombay High Court cited recent amendments in the provisions of the Mines and
Minerals (Development and Regulations) Act of 1947, that prevented
transfer of mines granted other than through auction. “Under the
circumstances, it was decided to apply for the withdrawal of the scheme
filed before the High Court, which was permitted by the High Court at
the hearing held on 25 February 2016,” according to a statement from
UltraTech. “Since the Regulatory approvals (including sanction of
Hon'ble Bombay High Court) could not be received prior to the Long Stop
Date, the Scheme stands revoked,” according to a separate statement from
JAL.
The move comes when UltraTech is said to be in
race to buyout Jaypee Group’s 20 mtpa cement assets, valued at Rs.20,000
crore along with other buyers like private equity firm KKR & Co.
Dalmia Cement (Bharat) Ltd and Sajjan Jindal led JSW Group. Aditya Birla
Group chairman Kumar Mangalam Birla had told The Hindu that UltraTech will maintain its leadership position in India.
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