DIS­COUNT OR DE­LAY

Business Today - - THE BUZZ - – Nevin John

THE SALE PROCESS of Essar Steel un­der the in­sol­vency law may face ei­ther of two even­tu­al­i­ties

- sale at dis­count or in­or­di­nate de­lay. The Supreme Court re­cently asked two lead bid­ders, Numetal con­sor­tium and ArcelorMit­tal to pay off their dues to qual­ify for Essar bid­ding.

Numetal will have to pay the en­tire debt of Essar Steel (around ` 49,000 crore) to qual­ify for the bid since Essar’s de­faulter pro­moter Re­want Ruia was one of its stake hold­ers. The cost for ArcelorMit­tal would be

` 7,000 crore. If both the bid­ders don’t find any merit in such a bid, they will back out, leav­ing Vedanta alone in the fray. It will re­duce the sale value.

Invit­ing fresh bids will be an­other op­tion. JSW Steel and VTB group (pro­moter of Numetal) are ex­plor­ing op­por­tu­ni­ties to go solo in bid­ding.

Aerial view of Essar Steel plant

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