Solo bid for Essar: JSW Steel seeking legal opinion, says official

JSW Steel is seeking a legal opinion if it can bid solo for stressed assets of Essar Steel, a top company official said Tuesday.

When asked if JSW Steel is mulling going solo for acquiring stressed assets of Essar Steel if fresh bids were allowed, JSW Steel joint managing director Seshagiri Rao said that it would depend on legal opinion and the view of the Committee of Creditors.

"It depends upon the legal opinion and the view of the CoC (Committee of Creditors) and the Resolution Professional (RP). If they take a positive view ... then we are open to look at it," he told reporters.

"We are seeking a legal opinion and based on that opinion we will take a call," he said.

He was speaking during the International Conference on Minerals and Metals.

"At that time when the second round of bidding was happening JSW Steel was looking at submitting the bid alone. We were not permitted. So, we have to see what view CoC and RP will take in the light of the Supreme Court judgement," he said.

JSW Steel had teamed up with NuMetal to place a Rs 370-billion offer for Essar Steel in the second round of bidding. 

NuMetal and ArcelorMittal were the only two parties that bid to buy out Essar Steel in the first round but the resolution professional was advised to reject both the bids owing to their promoters being linked to defaulter companies.

The Supreme Court last week granted one more opportunity to steel and mining major ArcelorMittal and Russia's VTB Bank-promoted NuMetal to bid for Essar Steel, provided the two pay off the non-performing assets (NPAs) of their related corporate debtors within two weeks. 

As per the judgement, ArcelorMittal would qualify to bid for Essar Steel only if it clears the Rs 70 billion dues of two firms, Uttam Galva and KSS Petron, it was previously associated with.

With regard to NuMetal, it has not specified NPAs of its related corporate debtors which have to be paid off to become eligible to bid for corporate debtors Essar Steel, which had NPAs or bad debts amounting to Rs 450 billion.