The world’s largest steelmaker ArcelorMittal has transferred Rs 7,000 crore to State Bank of India (SBI) to clear bank dues of loan defaulter Uttam Galva Steels so that it becomes eligible to bid for acquisition of Essar Steel, a person in know of the development said.
The world’s largest steel maker ArcelorMittal today asserted that its bid for debt-laden Essar SteelNSE 0.00 % is “eligible” and indicated that any pay off towards outstanding dues of Uttam Galva, a firm in which it was a minority shareholder till sometime back, would be a “goodwill gesture”.
Russia’s VTB Capital-backed NuMetal Ltd has moved the National Company Law Appellate Tribunal (NCLAT) against an order allowing rival ArcelorMittal to clear bank dues of associate companies so that it can become eligible for acquisition of Essar Steel.
The first round of resolution plans submitted for Essar Steel Ltd saw ArcelorMittal India offer greater value than competitor Numetal Mauritius, bankers in the know told BloombergQuint on condition of anonymity.
ArcelorMittal possibly faces a dues bill of over Rs 7,000 crore, to clear the eligibility hurdle in its bid for Essar Steel. The Ahmedabad bench of National Company Law Tribunal in its order last week observed that promoters of defaulting companies will have to clear outstanding loans to submit resolution plans.
The Ahmedabad Bench of the National Company Lay Tribunal (NCLT) on Thursday said the second round of bidding for bankrupt Essar Steel held on 2 April is invalid and directed the resolution professionals and the committee of creditors (CoC) to reconsider the first round of bids and reconsider offers from ArcelorMittal and Numetal.
Numetal Mauritius, which is contesting the rejection of its bid for Essar Steel Ltd, has offered to repay all of the debt of Odisha Slurry Pipeline Infrastructure Ltd, a crucial raw material supplier to the steelmaker, to get hold of a 70% stake from the firm’s current promoter, SREI Infrastructure Finance Ltd, a person close to the development told Mint on condition of anonymity.