ArcelorMittal offers ₹7,469 crore to KSS, Uttam Galva lenders
MUMBAI: ArcelorMittal will pay ₹7,469 crore to the financial creditors of Uttam Galva and KSS Petron to become eligible to bid for bankrupt Essar Steel India Ltd.
The announcement on Wednesday by the Luxembourgbased steelmaker comes days before the Supreme Court-set deadline—which expires this weekend—to comply with its eligibility requirement.
“ArcelorMittal announces that in-line with the Indian Supreme Court ruling dated October 4, 2018, it has approved a payment of ₹7,469 crore (approximately $1 billion) to the financial creditors of Uttam Galva and KSS Petron to clear overdue debts in order that the offer it submitted for Essar Steel India Ltd (ESIL) on April 2, 2018, is eligible and can be considered by ESIL’s Committee of Creditors,” the company said in a press statement.
On October 17, Mint reported that ArcelorMittal had admitted to a liability of ₹4,554 crore to bankers, far below the ₹7,469 crore it has now agreed to pay.
Mint’s report had discussed how the outstanding dues of both companies, where LN Mittal had, until recently, been listed as a promoter, had both been declared non-performing assets with outstanding debt of ₹5,654 crore (Uttam Galva) and ₹904 crore (for KSS Petron).
On October 4, the Supreme Court had granted one final opportunity to ArcelorMittal and Numetal—the two frontrunners with bids for Essar Steel—to settle outstanding dues in related companies and submit fresh bids for the stressed asset by the end of this week.
The court allowed this exception to prevent Essar Steel, a much sought-after asset, from going into liquidation where the recoverable value for lenders would be much lower.