Jaypee Group has proposed to merge JP Power Ventures Limited (JPPVL) with Jaiprakash Hydro Power Ltd (JHPL) in order to get all the power assets under the Jaypee Group umbrella .
The merger is subject to approval and sanction from the high court and is to get into effect from April 01,2009. The proposed merger stipulates one share of JPPVL for three shares of JHPL. Post merger, JHPL's equity shares would increase almost fourfold from Rs491million to Rs2.09 billion shares and JAL's stake in JHPL will go up from 63 per cent to 76.5 per cent.
In the valuation power projects of JAL that are either operational or financially closed have been considered using DCF-based valuation. So there isnt major implication to JAL's sum of the parts (SOTP) valuation from the proposed merger.