The Competition Commission has approved the acquisition of debt-ridden Essar Steel by a consortium of ArcelorMittal and Japan’s Nippon Steel & Sumitomo Metal Corporation. Earlier this month, ArcelorMittal had offered Rs 42,000 crore to acquire Essar Steel, upstaging a Rs 37,000 crore bid by Russia’s VTB Group-backed Numetal.
ArcelorMittal and Numetal are in the race to acquire Essar Steel, currently undergoing insolvency proceedings as it owes more than Rs 45,000 crore to over 30 banks.
“@CCI_India finds no appreciable adverse effect on competition in respect of ArcelorMittal and Nippon Steel & Sumitomo Metal’s proposed acquisition of Essar Steel,” the fair trade regulator said in a tweet Thursday.
Deals beyond a certain threshold are required to get clearance from the Competition Commission of India (CCI).
According to the notice submitted to the CCI, the proposed combination is pursuant to a resolution plan filed by ArcelorMittal India before the resolution professional for the acquisition of Essar Steel in accordance with the provisions of the Insolvency and Bankruptcy Code.
The acquisition of Essar Steel is proposed to be undertaken through multiple steps, which will be taken after and subject to obtaining requisite approvals of the Committee of Creditors and the National Company Law Tribunal (NCLAT) under the Code, as per the notice.
In a separate tweet Thursday, the CCI said it “finds no appreciable adverse effect on competition in respect of JSW Steel’s proposed acquisition of Bhushan Power & Steel”.
