Electrosteel Steels' EGM on Jan 7 to consider SDR package

Electrosteel Steels Ltd (ESL) will hold an extra ordinary general meeting of the shareholders of the company on January 7, 2016 to consider the Strategic Debt Restructuring (SDR) package approved by the Joint Lenders Forum.

The SDR entails conversion of its debt of Rs 2,508 crore into equity.

ESL’s Rs 9,600-crore debt has been put on a SDR package by the lenders, led by State Bank of India.

The SDR package is to bring in a new strategic investor and increase the financial viability of the steel-making company, which got bogged down by project implementation issues causing cost and time overrun. Lower steel prices and burgeoning finance cost have further extended the financial viability gap for ESL.

Lenders expect to identify the strategic investor by the end of this month. London-based fund house First International Group Plc and Tata Steel are learnt to have shown interest in the ESL’s project at Bokaro in Jharkahand.

The Rs 10 stock of ESL was trading at Rs 4.18 on Wednesday.