Jaypee Infratech appoints new CFO to delist shares as part of insolvency

Jaypee Infratech's shares on the BSE are currently suspended. The company, as of May 24, is under the management of Suraksha Group, following NCLAT approval

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Jaypee Infratech Ltd (JIL), now under the management of the Mumbai-based Suraksha Group, has appointed Devang Pravin Patel as its Chief Financial Officer (CFO) to begin the delisting of its shares from stock exchanges. The appointment was effective from June 8, 2024, as detailed in a regulatory filing by the company.

JIL’s shares on the BSE are currently suspended due to procedural reasons.

Jaypee Infratech delisting plan

Suraksha Group, which assumed control of JIL following the National Company Law Appellate Tribunal’s (NCLAT) approval last month, has taken significant steps to restructure the company.

A three-member board has been constituted. The board comprises Sudhir V Valia, promoter of Suraksha Group, as a non-executive director on JIL’s board, Aalok Champak Dave as executive director, and Usha Anil Kadam as independent director.

The board of directors have designated June 21, 2024, as the record date to determine shareholders eligible for the exit price as part of the delisting process.

Shares issued to Suraksha Group, in accordance with the approved resolution plan, will remain unaffected.  

Suraksha Group infuses Rs 125 crore in Jaypee Infratech

The NCLAT’s decision on May 24 upheld Suraksha Group’s bid to acquire JIL, emphasising the need to avoid further delays and protect stakeholders’ interests, including homebuyers and the Yamuna Expressway Industrial Development Authority (YEIDA).

As part of its resolution plan, Suraksha Group has infused Rs 125 crore in equity funds into JIL. This capital is aimed at settling dues with banks and completing 20,000 unfinished flats across various projects in the Delhi-NCR region.

Suraksha Group is also required to pay an additional Rs 1,334 crore to YEIDA as compensation for farmers.

Jaypee Infratech’s resolution process

The Corporate Insolvency Resolution Process (CIRP) for JIL began in August 2017, following an application by an IDBI Bank-led consortium.

In the fourth round of bidding in 2021, Suraksha Group secured the acquisition of JIL with 98.66 per cent of the votes from the committee of creditors (CoC), narrowly surpassing state-owned NBCC. The CoC comprised 12 banks and over 20,000 homebuyers. Earlier rounds saw various rejections and approvals, with the Supreme Court directing fresh bids in March 2021, ultimately leading to Suraksha Group’s successful bid.

The NCLT approved Suraksha Group’s bid to acquire JIL on March 7, 2023. Despite multiple legal challenges, including from YEIDA, the NCLAT upheld this decision in May 2024.

Suraksha Group’s final resolution plan includes offering more than 2,500 acres of land and Rs 1,300 crore in non-convertible debentures to bankers, with a commitment to complete all stalled projects within four years. Lenders had submitted claims amounting to Rs 9,783 crore.

As earlier reported by Business Standard, cement assets of Jaiprakash Associates, valued at Rs 5,666 crore, may already be on Adani’s radar while looking for acquisition for future expansions. With the appointment of a new CFO and the strategic delisting of its shares, JIL is poised for a significant transformation under Suraksha Group.