Ahmedabad: On Monday, March 11, the former promoter of Essar Steel, Prashant Ruia along with two other directors of the erstwhile steel maker moved the NCLAT challenging the global steel giant Arcelor Mittal’s take-over of debt-laden Essar Steel Ltd. The order came amidst a year-long legal dialect among bidders, banks and the Court, whereby Mittal rose to victory last week. Prashant Ruia along with others is hoping for thwart the takeover.
Alongside, the approved takeover has also been challenged by Standard Chartered Bank, a dissenting bank among the Committee of Creditors (CoC) of Essar Steel. The Bank has raised its concerns pertaining the resolution plan approved by the CoC of Essar Steel contending that it is more inclined towards the secured creditors.
The decision was handed down by the two-member NCLT bench of Justices Harihar Prakash Chaturvedi and Manorama Kumari after the appellate authority had set a deadline last month to close the matter by today.
Arcelor Mittal, a joint venture with Japan’s Nippon Steel & Sumitomo Metal Corp has offered a cash settlement of Rs. 42,000 crores to lenders and a Rs. 8,000 crore capital infusion. Moreover, as per its annual report, the global steel giant is planning a capital expenditure programme for the assets till 2024.
Till date, this turnover is the largest ever pay-out by a new company to an NCLT asset since the IBC came into effect in May 2016.
The NCLT order was highly appreciated by Arcelor Mittal, who wish to complete the transaction at the earliest.