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The National Company Law Tribunal (NCLT) is set to hear all the caveats filed by the operational creditors and aggrieved parties together in the Essar Steel insolvency case starting November 28.
Apart from the three separate cases already filed against the ArcelorMittal resolution approved by Committee of Creditors, some operational creditors are planning to move NCLT when it reopens on Monday after the festival holidays, a source said.
Sizeable haircut
Some of the banks and operational creditors have to take substantial haircut if the CoC-approved ArcelorMittal’s plan is okayed by the NCLT, he added.
For instance, Indian Oil Corporation and Bharat Petroleum Corporation is set to lose about ₹4,000 crore, if the ArcelorMittal offer is accepted.
Both Indian Oil Corporation and Bharat Petroleum Corporation, which have been classified as operational creditors in the Essar Steel case, have an exposure of ₹3,763 crore and ₹262 crore respectively.
If the ArcelorMittal plan goes through, operational creditors will get only ₹196 crore and the public sector oil companies will get the least as they are big operational creditors, said sources.
ArcelorMittal resolution plan includes an upfront payment of ₹42,000 crore against the overall admitted financial claim of ₹54,549 crore. The resolution professional has already rejected claim worth ₹14,727 crore. ArcelorMittal will infuse another ₹8,000 crore into Essar Steel to support operational improvement.
In a last-ditch attempt to retain its flagship, Essar Steel shareholders — which primarily includes Ruia Group companies — have offered to settle the company’s entire debt of ₹54,389 crore.
Standard Chartered Bank, which will recover only ₹61 crore against its exposure of ₹3,400 crore, has filed a caveat in NCLT as a dissenting financial creditor to the ArcelorMittal proposal.
Jalesh Grover, the resolution professional of GPI Textiles, a company promoted by Vinod Mittal brother of Lakshmi Mittal, has filed an interlocutory application at the Ahmedabad bench of the NCLT over reclaiming dues of ₹485 crore.
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