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The Mumbai Bench of the National Company Law Tribunal (NCLT) on Thursday approved the resolution plan of Aion Investment-JSW Steel consortium to acquire Monnet Ispat and Energy.
The lone successful bidder increased its bid by about ₹25 crore for MSME vendors, taking its total bid to ₹2,875 crore. Lenders will forego 72 per cent of Monnet Ispat's total outstanding loan of ₹10,000 crore. Aion Investment holds a 70 per cent stake in the consortium and JSW Steel the rest.
Seshagiri Rao, Joint Managing Director, JSW Steel, told BusinessLine the resolution plan for Monnet Ispat has been approved with modification, and more clarity on the deal will emerge after seeing NCLT’s final order.
In April, the resolution plan submitted by the consortium received 98 per cent favourable votes from the committee of creditors.
The approval for the plan was delayed as NCLT questioned the inclusion of the Gare Palma coal mine in Chhattisgarh as an asset of the company in the resolution plan while the licence for the mine had been cancelled by the government.
Monnet Ispat was among the first lot of 12 large non-performing loans referred by the Reserve Bank of India for resolution under the Insolvency and Bankruptcy Code (IBC). The resolution process for the company began last July and Sumit Binani was appointed the Insolvency Resolution Professional. The deadline for resolution was extended beyond 270 days.
Monnet Ispat owns an integrated steel plant of 1.5 mtpa along with associated facilities including a sponge iron plant, a pellet plant, a sinter plant and a captive power plant in Chhattisgarh. It also owns coal beneficiation facilities in Chhattisgarh and Odisha.
Among the 12 large cases referred for insolvency process, Monnet Ispat is the third to be resolved. Earlier, Tata Steel had bagged Bhushan Steel while billionaire Anil Agarwal-owned Vedanta was declared the successful bidder for Electrosteel Steel. The Reliance Industries-JM Financial ARC consortium has won the bid for Alok Industries but is waiting NCLT approval.
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