Companies

JSW Steel close to buying Vardhman Industries

Our Bureau Mumbai | Updated on December 06, 2019 Published on December 06, 2019

Almost a year after it was first approved, JSW Steel inched closer to acquiring Vardhman Industries (VIL) in the insolvency driven process as the National Company Law Appellate Tribunal ruled in favour of the company.

Last December, JSW Steel's resolution plan for the stressed Vardhman Industries was approved by the NCLT. However, the committee of creditors had made modification in the resolution plan unilaterally.

JSW Steel had moved the NCLT against the modification and sought clarification from the Tribunal before going ahead with implementation of the resolution plan.

On April 16, NCLT modified the resolution plan and said that any unrecovered amount due to VIL from any third party would be used to pay the dissenting financial creditors.

It also directed JSW Steel to approach Income Tax department for entitlement of carry forward losses and declined to end claims of VIL’s subsidiaries, associate companies and joint ventures.

On Wednesday, NCLAT ruled in favour of JSW Steel. However, the company in a statement said it is in the process of seeking certain clarifications from the NCLAT on its order and is in the process of filing an application with NCLAT for the same.

As per the approved resolution plan, JSW Steel will infuse ₹63.5 crore in Vardhman Industries through equity shares or debt within 30 days from the date of NCLT order. It will pay ₹62.5 crore to financial creditors while operational creditors will get ₹1 crore.

Vardhman Industries manufactures wide range of galvanised tubes, coils, precision steel tubes, galvanize steel pipes, steel square tube, galvanised sheets, corrugated steel tubes, and cold rolled steel sheets.

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Published on December 06, 2019
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