The Committee of Creditors (CoC) to the debt-laden Electrosteel SteelsBSE 4.72 % late Thursday chose resources conglomerate VedantaBSE -3.00 % Ltd as the highest bidder for the company, backing the earlier decision of the resolution professional.
The CoC, led by the State Bank of India, rejected the contentions of Renaissance Steel India that had questioned the eligibility of Vedanta and Tata Steel as bidders for Electrosteel in the dedicated bankruptcy process. Top lenders and executives of companies present at the meeting in Kolkata confirmed to ET the CoC decision that went in Vedanta’s favour.
The National Company Law Tribunal (NCLT) will now have to take a final call on the bid for the steelmaker. Vedanta didn’t comment on the outcome of the lenders’ meeting. On Thursday, Renaissance representatives raised several objections but these were rejected by the CoC.
“We are disappointed obviously. We are evaluating our legal options. This is a new law. So we will firm up our plans in the next few days. We will approach the courts on April 2,” a top executive in Renaissance told ET.
ELIGIBILITY ISSUE
There was seemingly no discussion Thursday on the eligibility issue of the two bidders. The law firm representing the resolution professional told the lenders that Vedanta’s eligibility can be justified.
Thursday’s CoC meeting was convened after the NCLT, acting on a petition by Renaissance Steels chairman Abhishek Dalmia, directed the resolution professional Dhaivat Anjaria to submit his explanation to the CoC on why he felt that bids by Tata Steel and Vedanta were eligible. Dalmia had questioned the eligibility of the two bidders for their alleged violation of Sec 29(A) of the Insolvency and Bankruptcy Code (IBC).
