Amtek lenders mull new bidder after Liberty House misses repayment deadline

Lenders to insolvent Amtek Auto might approach the National Company Law Tribunal (NCLT) to find a new bidder for the entity. UK-based Liberty House, which won the earlier bid for the insolvent company in July, has missed a deadline to pay the banks.

“Amtek Auto has moved into advanced stages of resolution, but time is running out for recoveries. This is worrying for us, since the amounts expected on this account are substantial,” said an executive of a public sector bank among Amtek’s lenders.

Sanjeev Gupta-led Liberty House was to pay lenders Rs 48.1 billion by October, according to the resolution plan.

“This group (Liberty House) has made bids for many insolvent accounts. But, not much headway has been seen,” said the banker quoted above.

Liberty House also bagged Adhunik Metaliks, along with its Zion Steel unit. It is also eyeing ABG Shipyard. The company has also bid for Odisha-based Bhushan Power & Steel, as have Tata Steel and Sajjan Jindal-led JSW Steel.

A source at Liberty House said they were waiting for legal disputes to be resolved.

“We are waiting for disputed court cases of Amtek Auto in the insolvency tribunals such as NCLT and National Company Law Appellate Tribunal (NCLAT) to be resolved before the deals can be completed,” said the source, also citing its commitment to Adhunik Metaliks, for which the company had bid about Rs 4 billion.  

“The Adhunik unit is shut, but we paid salaries to the employees ahead of Diwali despite not having taken full control of the unit so far,” added the source.

Liberty House made these acquisitions via parent GFG Alliance. It is also setting up an office in Mumbai after having appointed Mahendra Singh Mehta its India head.

Lawyers are of the view that since the entire process was decided by the committee of creditors (CoC) and has to be acted upon by the buyer, the CoC could move the NCLT unless Liberty House moves the tribunal earlier seeking an extension on payments.

“If we can acquire three units of Arcelor Mittal in Europe and continue to purchase assets in other parts of the world, why would we not make payments here?” said the company source.

Last week, Liberty House announced a deal with ArcelorMittal to acquire three European steel plants — two in Belgium and one in Luxemberg.

This closely follows another conditional agreement with ArcelorMittal last month to acquire major integrated works at Galati in Romania and Ostrava in the Czech Republic, along with mills at Skopje in Macedonia and Piombino in Italy.