Comments
The National Company Law Appellate Tribunal (NCLAT) has directed ArcelorMittal, the winning bidder for the stressed Essar Steel asset, to deposit the bid amount of ₹42,000 crore in a separate account either before itself or the Ahmedabad Bench of the National Company Law Tribunal (NCLT).
The next hearing in the case is scheduled for April 23.
The two-member Bench headed by Chairman Justice SJ Mukhopadhaya also directed ArcelorMittal to file an affidavit with details on the steps it is taking to implement the approved resolution plan for the revival of Essar Steel.
Stating that ArcelorMittal has not deposited the money despite clear instructions, the NCLAT said the company will be forced to comply soon.
While agreeing to bring in the money, ArcelorMittal claimed there is reluctance on the part of the lenders to execute the debt assignment agreement. “Money cannot be deposited without assignment of debt in favour of the company,” said ArcelorMittal.
Extra allocation
The Bench also ordered the Committee of Creditors (CoC) to submit details on the outcome of a meeting held to consider extra allocation for operational creditors. In their previous meeting, the CoC had agreed to increase the payout to operational creditors to ₹1,000 crore from ₹200 crore, as directed by the NCLT.
However, the lenders refused to consider Standard Chartered Bank as a financial creditor, which would have result in a higher payout to the UK-headquartered bank.
Under the resolution plan submitted by ArcelorMittal, financial creditors would get about ₹42,000 crore out of their total dues of ₹49,395 crore while operational creditors would get just ₹214 crore against their outstanding ₹4,976 crore.
The NCLAT also directed both financial and operational creditors to submit details on their approved claims while providing a copy of the approved ArcelorMittal resolution plan to Essar Steel promoters, the Ruias.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.