JSW, Liberty House and Tata likely to bid for Usha Martin steel business

At least three companies — JSW Steel, Tata Steel, and Liberty House — are understood to be evaluating a bid for Usha Martin, which is in the last lap of divesting its steel business.

Of the five companies in the fray, these three are potential bidders, source said. Bids are expected to be invited this month.

JSW is in the process of doing a due diligence, which is expected to be completed in a few weeks, said Seshagiri Rao, company’s joint managing director and group chief financial officer. Rao, however, clarified the company would evaluate a bid if it was a good opportunity.

A Tata Steel spokesperson said evaluating strategic growth opportunities was an ongoing activity. Liberty House declined to comment.

Usha Martin had put its steel business on the block to pare its debt, pegged at around Rs 45 billion. Sources close to the development said Arpwood Capital and SBI Capital Markets were given a joint mandate of finding buyers in June.

The Usha Martin board decided to set up an independent committee also to evaluate proposals and oversee the process of sale of the steel business. The firm has a one-million tonne plant in Jamshedpur. Around one-third of its production is used in-house by the wire and wire rope division, and the rest is sold to buyers, who in turn supply it to the commercial automotive sector.

If JSW Steel, Tata Steel, and Liberty bid for Usha Martin, it would be yet another firm that the three steelmakers would be vying for. The trio are locked in a battle for Bhushan Power & Steel, which is going through insolvency proceedings.

Lenders have submitted their evaluation of revised bids for Bhushan Power to the National Company Law Appellate Tribunal (NCLAT) where the matter is being heard.

JSW Steel has made the highest offer in the revised bid for Bhushan Power. Tata Steel, earlier declared as the highest qualified bidder for the debt-ridden company, had opposed the rebid.  JSW Steel had revised its bid last minute.

But much before that, Tata Steel had challenged Liberty’s bid for Bhushan Power. Bhushan Power & Steel was a two-way race initially. 

Tata Steel and JSW Steel had submitted their bids within the deadline. However, Liberty House made a late bid. The committee of creditors had rejected Liberty House’s bid on grounds of late submission but finally the National Company Law Tribunal (NCLT) asked the committee to consider it. Tata Steel had challenged the NCLT order in the NCLAT.

All the three companies have acquired assets under the Insolvency and Bankruptcy Code. 

 Tata Steel has bagged Bhushan Steel, while JSW Steel has acquired Monnet Ispat & Energy with AION, and Liberty House has got Adhunik Metaliks and Amtek Auto.