UltraTech Cement has settled a long-running arbitration with Jaiprakash Associates (JAL), agreeing to redeem ₹1,000 crore of preference shares tied to the Dalla Super cement asset, people familiar with the matter told ET. The resolution helps in monetising Jaypee assets after a bankruptcy court recently allowed Adani Group to take over JAL.
Adani Group has offered to pay ₹14,535 crore to buy the bankrupt JAL in the insolvency process, even as the group is yto fully complete payments to creditors. The settlement with the Aditya Birla Group cement flagship UltraTech for plant located in north-central India is expected to reduce Adani’s upfront cash outgo under the resolution plan, with proceeds flowing directly to lenders.
The dispute had arisen after UltraTech deferred redemption of preference shares issued in 2017, citing pending regulatory approvals linked to the asset. JAL had contested the delay, triggering arbitration. The matter has now been resolved out of court, with both sides agreeing to close the issue.
Spokesperson of UltraTech did not respond to a request for comment immediately.
This payout of ₹1,000 crore will be routed via an escrow mechanism, ensuring that funds are ring-fenced for lenders. “Any monetisation will flow directly to creditors, with regulatory oversight in place,” one source said.
Last week, the National Company Law Tribunal (NCLT) had approved the acquisition of Jaiprakash Associates by Adani Enterprises. The approval has allowed Adani Enterprises to take control of the debt-laden infrastructure and cement company.
Under the arrangement, even if documentation is executed before full completion of Adani’s payment obligations, which has 90 days to pay lenders post the plan approval by NCLT, proceeds from such asset-level settlements or sales will be earmarked for lenders, aligning with insolvency norms.
