A JSW Steel entity is set to acquire National Steel and Agro Industries through the insolvency process.
J M Asset Reconstruction Company, the sole lender of National Steel and Agro after having taken over the troubled steelmaker’s debt, on Friday issued a letter of intent to JSW Steel Coated Product Pvt Ltd accepting its resolution plan, stock exchange disclosures show.
JSW Steel is believed to have offered Rs 400-425 crore to acquire the company, a person with knowledge of the matter told ET.
National Steel and Agro’s resolution professional Dushyant Dave has admitted Rs 2,023 crore claims, of which JMARC, the sole secured lender, has a claim of Rs 1,686 crore.
The ARC had acquired National Steel and Agro’s loans from 70% of lenders by value in April 2021 in an uncontested Swiss auction. Subsequently, it acquired the balance loans in phases. It paid about 35 paise on the rupee principal to acquire the entire debt, said a person aware of the development.
JSW Steel informed stock exchanges on Friday that the committee of creditors of National Steel and Agro has approved its plan and declared it as a successful resolution applicant.
JSW Steel can take possession of the company only after the bankruptcy court approves its plan.
The National Company Law Tribunal (NCLT) had admitted National Steel and Agro for insolvency proceedings on April 11 this year following a petition filed by J M ARC.
In the past, JSW Steel Coated Products had acquired Asian Colour Coated Ispat for Rs 1,550 crore, while JSW Steel acquired Bhushan Power and Steel for Rs 19,350 crore. Both these acquisitions were done under the Insolvency and Bankruptcy Code.
National Steel and Agro, promoted by Santosh Shahra, is engaged in making steel and exporting agricultural products such as rice, wheat and soybean. Its steel plant, located in Madhya Pradesh, has an installed capacity of around 330,000 tonnes per annum (TPA) galvanised steel, according to the company’s website.
