New Delhi, April 10 – The Vedanta Group on Friday questioned the evaluation criteria used by lenders of Jaiprakash Associates Ltd (JAL) in selecting Adani Enterprises' bid of Rs 3,400 crore for the debt-ridden company.
During proceedings of the National Company Law Appellate Tribunal (NCLAT), the legal counsel representing Vedanta Ltd. stated that the evaluation process had been used to "negate commercial expertise" by the Committee of Creditors (CoC).
Senior advocate Abhijeet Sinha, while pointing to the CoC's evaluation matrix, asked if it was used "to maximize value or for some other purpose."
He argued that the evaluation matrix, the request for resolution plan (RFRP), and the process note relied upon by the CoC were merely guiding tools and could not override the core objective of the insolvency framework, which is maximizing value.
Sinha alleged that Vedanta's bid was Rs 3,400 crore higher in gross value and Rs 500 crore higher in net present value (NPV) compared to the resolution plan submitted by the Adani Group. He claimed that there was no discussion about a lower bid during the CoC meeting.
The CoC has appointed BTO India LLC to conduct feasibility and viability analysis of the resolution plans received, which assigned scores to each of the five resolution plans based on the evaluation criteria, which did not reflect "sound commercial judgment."
"In this, the maximum score is 35 out of 35. Adani gets 29.30, while we get 18.51," Sinha said, adding that "this is actually the only factor that determined the decision, but it's also a scoring factor that the CoC itself hasn't used."
Regarding NPV, Vedanta scored 35 out of 35. "The other factor where we are lower is the equity infusion for improving business operations within 180 days. We scored 2.56 and 5," he said.
The NCLAT was hearing petitions filed by Vedanta Ltd., which challenged the selection of Adani Enterprises as the successful resolution applicant for JAL.
Vedanta's counsel argued that the CoC, after introducing a challenge process due to sub-optimal bids, approved the very plan it had initially found inadequate, undermining the integrity of the process.
He alleged material irregularities and a lack of transparency in the entire process, and argued that the design of the challenge mechanism itself was inherently unfair, as bidders were required to submit both upfront and deferred payment components but were only shown the highest NPV after each round.
On March 24, the NCLAT declined to issue any interim stay on the Vedanta Group's plea against the order passed by the NCLT approving Adani Group's Rs 14,535-crore bid to acquire JAL.
However, it had also stated that the plan was subject to the outcome of the appeals filed by the Anil Agarwal-led Vedanta Group.
This interim order by the 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.
On March 17, the NCLT, Allahabad bench, approved Adani Enterprises Ltd's Rs 14,535-crore bid to acquire JAL through the insolvency process.
Adani Enterprises had outbid Vedanta and Dalmia Bharat to win the bid for JAL. Adani secured the maximum 89 per cent votes from creditors, followed by Dalmia Cement (Bharat), and Vedanta Group.
The CoC defended its decision, stating that the process complied with all Insolvency and Bankruptcy Code (IBC) rules. They maintained that no bidder had a guaranteed right to win, even if it offered the highest value.
They said that plans were evaluated on multiple factors, including upfront cash, feasibility, and execution, not just headline value.
JAL, which has high-quality assets and business interests spanning real estate, cement manufacturing, hospitality, power, and engineering & construction, was admitted to the Corporate Insolvency Resolution Process (CIRP) in June 2024 after defaulting on payments of loans aggregating Rs 57,185 crore.
JAL has major real estate projects like Jaypee Greens in Greater Noida, a part of Jaypee Greens Wishtown in Noida (both on the outskirts of the national capital), and the Jaypee International Sports City, located near the upcoming Jewar International Airport.
It also has three commercial/industrial office spaces in Delhi-NCR, while its hotel division has five properties in Delhi-NCR, Mussoorie, and Agra.
JAL has four cement plants in Madhya Pradesh and Uttar Pradesh, and a few leased limestone mines in Madhya Pradesh.
It also has investments in subsidiaries, including Jaiprakash Power Ventures Ltd, Yamuna Expressway Tolling Ltd, Jaypee Infrastructure Development Ltd, and several other companies.