Jaiprakash Associates will be hiving off its cement plants and other units of the company to wholly owned subsidiary - Jaypee Cement Corporation (JCCL). The company’s equity shareholders and creditors at a meeting directed by Supreme Court, held on February 25, 2012, duly approved the Scheme of Arrangement between the company and its wholly owned subsidiary.
Earlier, the group was reported to be in negotiations with investors for selling a part of its cement business to pare debt, which is over $8 billion or Rs 40,000 crore, by more than a third.
Jaypee's cement business is housed in Jaiprakash Associates, a listed company that has a cement-making capacity of 28 million tonnes a year, making it India's third-largest cement producer, behind capacities owned by Germany's Holcim and the Aditya Birla Group.
Jaiprakash Associates reported a fall of 12% in its net profit of Rs 205 crore in the third quarter of the current fiscal, mainly on higher interest outgo. The company had clocked Rs 233 crore net profit during the October-December quarter of last fiscal. The interest outgo of the company rose to Rs 449 crore during the quarter compared to Rs 338 crore a year ago as a result of the tightening of the monetary policy by the Reserve Bank of India.