The National Company Law Appellate Tribunal (NCLAT) has said that it will decide on the on the petitions filed by world’s largest steel manufacturer ArcelorMittal and Russia’s VTB Capital-backed Numetal over issues pertaining to eligibility of their bids for taking over debt-ridden Essar Steel. The matter has been listed for judgment today.
The judgment has been scheduled almost around two months after the appellate tribunal reserved its decision on the matter. On 18 July, a two-judge NCLAT bench headed by justice S.J. Mukhopadhyay asked both the resolution applicants to file written submissions by 23 July as it concluded hearings on the petitions, challenging their disqualification in the first round of bids.
While reserving its judgement, NCLAT had asked ArcelorMittal if they are willing to pay the full dues of Uttam Galva and KSS Petron till date (amounting to excess of Rs 7,000 crore) without any condition in order to become eligible to submit resolution plan for Essar Steel.
During a hearing on 16 July, NCLAT hinted at giving a chance to both the resolution applicants who submitted bids for Essar Steel Ltd, to cure ineligibilities after which revised bids may be invited from the companies.
ArcelorMittal, in its plea, had challenged its disqualification on grounds that it had exited Uttam Galva before submitting a bid for Essar Steel on 12 February. Essar Steel has a debt of Rs 49,000 crore and was referred to NCLT in June 2017. After the two firms were disqualified by the resolution professional under Section 29A of IBC, which prohibits related parties of defaulting firms from participating in the resolution process, the two firms had filed appeals before the tribunal.
Numetal was disqualified on ground that Rewant Ruia, son of Essar Steel promoter Ravi Ruia, is a beneficiary of a trust that backed Aurora Enterprises, which in turn held a 25% stake in Numetal. VTB is the largest investor with a 40% stake.
In the second round of bidding, Anil Agarwal’s Vedanta Resources also joined the race. Besides, JSW joined Numetal for the bid.
Source: Mint