Arcelor Mittal, Nippon Steel, Tata Steel and the Ruias are among the seven or eight players that have shown interest in Essar Steel, where an insolvency resolution professional had called for expression of interest (EoI). Sources said the companies have submitted their EoIs as Monday, which was the last day. Essar Steel, promoted by Ruias, who recently exited Essar Oil, was among the initial 12 companies identified by the RBI for insolvency proceedings as the promoters were not seen to be acting swiftly to get the loan-laden company back on track.
The lenders had tried to rope in investors two years ago, but their attempts did not yield significant results as the promoters had also promised to step up production and ensure timely debt repayment.
Essar Steel, which has a plant in Gujarat with an annual production capacity of 10 million tonnes, owes close to Rs 45,000 crore to banks led by SBI, which was prompt in moving the National Company Law Tribunal. The Central Government has constituted National Company Law Tribunal (NCLT) under section 408 of the Companies Act, 2013 (18 of 2013) w.e.f. 01st June 2016. In the first phase the Ministry of Corporate Affairs have set up eleven Benches, one Principal Bench at New Delhi and one each Regional Benches at New Delhi, Ahmedabad, Allahabad, Bengaluru,... More after the RBI diktat. The steel companies are seen to be a viable way for several players which do not have a footprint in the country to enter the Indian market. Laxmi Mittal’s ArcelorMittal has been in talks with government-owned SAIL for a possible joint venture.
Some of the companies such as ArcelorMittal have also evinced interest in Bhushan Steel, which is also facing insolvency proceedings. The company’s stock rallied 20% on the stock exchanges on reports of several companies looking to buy Bhushan Steel, which is estimated to have loans of around Rs 42,000 crore.