Arcelor-Nippon open to working with Ruias

MUMBAI: The Arcelor Mittal Netherlands BV, and Nippon Steel and Sumitomo Metal Corp. joint venture (JV) is open to working with the promoters of Essar Group to successfully implement the resolution plan for debt-ridden Essar Steel Ltd if required, two people close to the development told Mint on condition of anonymity.

The two firms, which have submitted a combined bid for the beleaguered steel maker, have taken into consideration the dependability of other assets of the Essar Group which are crucial to its steel business but are outside the ambit of insolvency proceedings so far and continue to be controlled by the Ruias , the promoters of the group.

Even as the spokespersons of Arcelor and Nippon declined to comment on the details of the resolution plan submitted by them on April 2, they said that it takes care of all the “contentious issues” that may arise in case they acquire Essar Steel.

To be sure, Essar Steel uses the facilities of Essar Ports and Essar Power for supply of raw materials and power, respectively. While Essar Steel is undergoing resolution proceedings under the Insolvency and Bankruptcy Code, the power and port assets are outside the insolvency net.

One of the issues that the potential acquirer may have to contend with is ensuring a steady supply of raw materials in case the facilities of Essar Ports and Essar Power are unavailable after the acquisition.