Renowned Indian construction firm, Jaiprakash Associates would merge Jaypee Hotels (JHL), Jaypee Cement (JCL), Gujarat Anjan Cement (GACL) and Jaiprakash Enterprises (JEL) with the flagship public-listed company Jaiprakash Associates (JAL). The meager is aimed to insulate the business from the impact of the global slowdown as there is a huge demand-supply mismatch in different geographical regions. All companies under a single roof would allow better control over subsidiaries, allowing better economic management and business effectiveness.
 
The entire transaction would be cashless and there is no need to pay the dividend distribution tax (DDT). The move would bring down promoter's stakes in JAL from 45.28% to 37.65%. Each subsidiary would create the trusts and the cross holding of the company's shares will be transferred to these trusts.
 
The board of directors of company has already approved the acquisition idea on Monday. The company would issue three shares for every share held for the acquisition of the group firm Jaiprakash Enterprises. However, shareholders of Jaypee Hotels would get one share in Jaiprakash Associates for every share held. The acquisition would be considered effective from the reference date of April 1, 2008.