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The National Company and Law Tribunal has approved JSW Steel Coated Products, a wholly-owned subsidiary of JSW Steel, Rs 1,550-crore bid to acquire Asian Colour Coated on Monday with 'certain modification' in the resolution plan approved by the lenders.
Despite the NCLT order after two-years of wait, the uncertainty over closure of the deal continues as the bidder is not aware of the modification in the final order.
“The written order of NCLT is still awaited,” said JSW Steel in a statement on Monday.
JSW Steel is set to acquire Asian Colour Coated when the steel demand is slowly reviving after the economy was ravaged by the nation-wide lockdown imposed to tackle Covid pandemic.
The resolution plan of JSW Steel has received approval from 80 per cent of Committee of Creditors. JSW bid includes Rs 1,525 crore payment to financial creditors and Rs 25 crore to operational creditors. The leading lenders of Asian Colour Coated include SBI, Punjab National Bank and JM Financials.
Asian Colour had defaulted on a ₹4,900-crore loan and was dragged to insolvency proceedings in 2018. The case has gone through many twist and turns. JSW Steel, which had initially placed a bid of Rs 1,200 crore revised it to Rs 1,550 crore in May and the same was approved by the lenders last June.
However, the promoters of Asian Colour Coated moved NCLAT against the lenders decision and litigation on land issues.
Even while NCLAT cleared the litigations and paved the way for further progress in the case, an US-based fund Interups, which had not even submitted expression of interest, placed a bid of Rs 2,000 crore with the resolution professional of the company last June and moved the NCLT to direct lenders to consider its higher bid.
Of late, primary steel producers have been showing interest increasing their presence in value added products. Asian Colour Coated, which has production facilities in Delhi and Mumbai, specialises in downstream, galvanised and colour-coated products that are exported to Europe, Latin America and Africa. It has an annual capacity of 1 million tonne.
JSW Steel had already acquired two assets – Monnet Ispat and Vardhman Industries – through Insolvency and Bankruptcy Code. It is fighting court battle for last three years to close the acquisition of insolvent Bhushan Power and Steel.
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