Uttam Galva unaware of Arcelor move to clear dues

Utt am Gal va Steel s promoters said they were unaware of the reported' unsolicited' move by Arc el or Mitt alto transfer about ~70 billion to State Bank of India to clear over due loans of the co mp any.Utt am Gal va Steel s Chairman Rajinder Uttamchand Miglani said the founders had in February bought out Arc el or Mitt al’ s 29.1 percent stake in the firm.

Uttam Galva Steels promoters on Wednesday said they were unaware of the reported ‘unsolicited’ move by ArcelorMittal to transfer about ~70 billion to the State Bank of India (SBI) to clear overdue loans of the company.

Uttam Galva Steels Chairman Rajinder Uttamchand Miglani said the founders had in February bought out ArcelorMittal’s 29.1 per cent stake in the company after a request of the same came from them. But, this time around, there had been no communication with ArcelorMittal on the clearing of the company dues, he said.

“We are not aware of any such move. I have no communication of any kind,” he said in response to a question on the ArcelorMittal’s reported move to transfer about ~70 billion to an escrow account maintained by SBI.

He said Uttam Galva had in the past asked ArcelorMittal, which till February was classified as a promoter of the company, for help to clear dues. “There was no response then,” he said, adding no solicitation was made to ArcelorMittal this time around.

“We are not aware of any move (by ArcelorMittal) to transfer funds as we are in NCLT,” he said, adding the sectoral issues faced by Indian and global steel market in 2015-16 had hit the company’s financial performance very hard and led to default. ArcelorMittal declined comments on Miglani’s statement. Miglani said the founders have no knowledge of what communications ArcelorMittal is having with the financial institutions. “It is as much Greek to me as it is to you. I have no knowledge of what is happening,” he said.

Uttam Galva owes ~56.54 billion to 18 banks, largest among them is SBI.

ArcelorMittal has reportedly transferred ~70 billion to SBI to clear dues of defaulters Uttam Galva and KKS Petron so that it becomes eligible to bid for acquisition of Essar Steel.

The move followed its bid for Essar Steel coming in for questioning because of its past shareholding in loan defaulter firms. The insolvency and bankruptcy rules bar a delinquent promoter from bidding for a company or asset that is being auctioned to recover bank dues.

ArcelorMittal wants the funds transferred in an escrow account to be used to pay off outstanding dues of Uttam Galva Steel as well as KSS Petron.