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Tata Steel, Vedanta, JSW to make financial bids for Bhushan Power & Steel

The last date for accepting the bids has been extended to February 8 as bidders seek more clarity on the income tax (I-T) liabilities

Dev Chatterjee & Ishita Ayan Dutt  |  Mumbai/Kolkata 

Bhushan Steel, Bhushan Power

Tata Steel, Vedanta, and Steel have finalised their plans to make financial bids for Bhushan Power & Steel, which has defaulted on loans worth Rs 470 billion to Indian lenders. Besides, the big three metal majors, Edelweiss Asset Reconstruction Company and a Dubai-based investor are also expected to bid. The last date for accepting the bids has been extended to February 8 as bidders seek more clarity on the (I-T) liabilities. The Budget on February 1 is likely to clarify of stressed assets. The liquidation value of the firm is Rs 120 billion and lenders expect bidders to make at least this sum as upfront payment to them against the loan when they make their bids. Among the bidders, the lenders are expecting cash-rich to make the most aggressive bids for Bhushan Power, while Steel is expected to put its might behind Bhushan Steel’s assets, which runs a five-million tonnes per annum plant in is expected to make conservative bids for both Bhushan assets considering that it has its own expansion plans at in When asked whether would be bidding for Bhushan Power, a spokesperson said, “As a process, we do assess and evaluate various strategic opportunities for growth. This is an ongoing process in the company.” and Steel did not comment. Sources close to the developments said has withdrawn from the bidding process for Bhushan Power. The firm is likely to focus on and Essar Steel. Tata Steel, Vedanta, JSW to make financial bids for Bhushan Power & Steel According to a PTI report quoting a source, Steel is expected to double its bid value for debt-laden “The liquidation value has set been set at Rs 150 billion, below that the bid will not be accepted. Looking at the competition, Steel is expected to double its bid amount.

It can be between Rs 250 billion to Rs 300 billion,” the source told PTI. The unlisted Bhushan Power & Steel has a of three million tonnes across Odisha, West Bengal, and Chandigarh. A hot-rolled steel facility is in and cold-rolling facilities are in Kolkata and Chandigarh. Bhushan also has a captive power plant, a pellet plant and an ore beneficiation plant. Bhushan’s debt in FY16 stood at Rs 372 billion, net sales were at Rs 77 billion and losses were Rs 24.36 billion. The dues have ballooned to Rs 470 billion. Bhushan Power & Steel ran into trouble after its licences for the ore and coal mines were cancelled. The company was allotted a coal mine, with reserves of around 250 million tonnes, but this was deallocated in 2014. The ore mines were committed by the government. Two mines were allocated in 2012 and 2014 after an intervention of the Subsequently, the amended Mines and Minerals (Development and Regulation) Act was passed in 2015 and as a result, Bhushan’s ore mines were cancelled.

First Published: Mon, January 29 2018. 05:23 IST
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