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ArcelorMittal makes strong pitch as eligible bidder for distressed assets

It is also in the process of conducting due-diligence for larger stressed assets in sector, namely, of Essar Steel, Bhushan Steel and Bhushan Power & Steel

Ishita Ayan Dutt  |  Kolkata 

ArcelorMittal makes strong pitch as eligible bidder

ArcelorMittal, the world’s largest steelmaker, has made a strong pitch as an eligible bidder for distressed assets currently going through insolvency resolution.

It issued a statement that recent amendments to the were intended to prevent defaulting promoters from buying the same assets out of bankruptcy.

“We are a widely recognised and highly creditworthy international investor and do not believe this amendment should prevent from bidding for distressed steel assets in which we have had no prior involvement,” went the statement.

It also clarified, “We hold a non-controlling minority shareholding in Uttam Galva, have no representation on the board of directors, nor influence on management decisions. As such, we are not a promoter of Therefore, there is no objective reason for to be prevented from bidding for any steel asset under the restructuring process.”

The statement follows doubts raised regarding its bid after the recent amendments to the through an ordinance, that not only barred defaulting promoters but added a new Section 29A. This prohibits promoters or sister concerns of with non-performing assets (NPAs) of more than a year from bidding for these To bid, promoters have to make the NPAs standard assets by paying the principal and interest.

In 2009, had bought a stake in Steels. Last September, however, was classified as an NPA and is in the Reserve Bank of India’s second list of major ones in this regard. Two credit rating agencies, CRISIL and ICRA, have been appointed by the central bank to vet Uttam Galva’s restructuring proposal. 

Netherlands BV is, according to the shareholding pattern filed with the BSE, classified as a promoter group company of Steels, with 29.05 per cent stake, though it doesn’t have a board or management representative and is a passive shareholder.

is also in the process of conducting due-diligence for larger stressed assets in sector, namely, of Essar Steel, and

After the ordinance, resolution professionals are in the process of preparing to see that prospective bidders fulfill the terms under Section 29A. “We are in the process of writing to all the prospective bidders for an undertaking that they meet the terms under this section. Once they furnish this, due-diligence will be done,” said the resolution professional for a stressed steel asset.

ArcelorMittal makes strong pitch as eligible bidder

First Published: Thu, November 30 2017. 01:12 IST
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