GailNSE 2.24 % (India) and Gujarat Energy Transmission Corporation have joined the ranks of a clutch of operational creditors seeking rejection of ArcelorMittal’s Rs 42,000-crore resolution plan for Essar SteelNSE 0.00 % unless their claims are added to the proposal. The two state-run companies have filed separate applications for claims totalling nearly Rs 1,800 crore at the National Company Law Tribunal, Ahmedabad.
Last month, the committee of creditors of Essar Steel had picked ArcelorMittal’s proposal for Essar Steel. Under the plan, financial creditors stand to get Rs 41,987 crore out of total dues of Rs 49,395 crore, while operational creditors are to get only Rs 214 crore against their outstanding dues of Rs 4,976 crore.
Last week, 29 operational creditors of Essar Steel had filed petitions in NCLT pleading that ArcelorMittal’s plan be rejected and instead the debt settlement proposal made by shareholders of Essar Steel be considered as it would pay off all outstanding of both financial and operational creditors.
Gujarat Energy Transmission Corporation (Getco), set up as a subsidiary of Gujarat Electricity Board (GEB) in 1999, filed the application under Section 60 of the Insolvency and Bankruptcy Code (IBC) and regulation 14 of the Insolvency and Bankruptcy Board of India Regulations 2016, seeking appropriate orders and directions to include its total claim of `896.52 crore and has sought rejection of the resolution plan if it is not met.
Getco said the dues pertains to power transmission and wheeling charges from May 2005 to March 2011. The resolution professional (RP) for Essar Steel, however, has only admitted a notional claim of Rs 1.
Getco has also said it is “vitally affected by the resolution plan approved by the committee of creditors”.
Gail in its application said it had a gas supply agreement with Essar Steel and thus Essar was obliged in law to make payment to Gail. The PSU has raised objection to resolution plan by addressing letter to Essar Steel resolution professional Satish Gupta, saying the plan is in contravention of Section 30 (2) of Insolvency and Bankruptcy Code 2016 and even otherwise the resolution plan is “neither legal nor proper in interest of all creditors” and it “completely fails to protect interests of operational creditors”.
Gail also said Essar Steel Asia Holdings Mauritius has written to it proposing payment of admitted claim as against nil payment by ArcelorMittal. Gail in the November 16 application said it has a claim of Rs 907.20 crore towards non-offtake of gas.
Out of this, around `125 crore has already been admitted in the list of creditors of the company.
Getco and Gail did not respond to ET’s email queries on the matter as of press time Monday.
Last month, Essar Steel Asia Holding Ltd (ESAHL), the promoter of Essar Steel, had proposed to repay Rs 54,389 crore to clear dues of all financial and operational creditors in a desperate bid to save its ownership of the company.
Source: Economic Times