Competition Commission approves ArcelorMittal's acquisition of Essar Steel

The Competition Commission has approved the acquisition of debt-ridden Essar Steel by a consortium of ArcelorMittal and Japan's Nippon Steel & Sumitomo Metal Corporation.

Earlier this month, ArcelorMittal had offered Rs 420 bilion to acquire Essar Steel, upstaging a Rs 370 billion bid by Russia's VTB Group-backed Numetal.

ArcelorMittal and Numetal are in the race to acquire Essar Steel, currently undergoing insolvency proceedings as it owes more than Rs 450 billion to over 30 banks.

"@CCI_India finds no appreciable adverse effect on competition in respect of ArcelorMittal and Nippon Steel & Sumitomo Metal's proposed acquisition of Essar Steel," the fair trade regulator said in a tweet Thursday.

Deals beyond a certain threshold are required to get clearance from the Competition Commission of India (CCI).

According to the notice submitted to the CCI, the proposed combination is pursuant to a resolution plan filed by ArcelorMittal India before the resolution professional for the acquisition of Essar Steel in accordance with the provisions of the Insolvency and Bankruptcy Code.

The acquisition of Essar Steel is proposed to be undertaken through multiple steps, which will be taken after and subject to obtaining requisite approvals of the Committee of Creditors and the National Company Law Tribunal (NCLAT) under the Code, as per the notice.

ArcelorMittal India is an arm of ArcelorMittal, the world's leading steel and mining company with a presence in 60 countries and an industrial footprint in 18 nations.

In a separate tweet Thursday, the CCI said it "finds no appreciable adverse effect on competition in respect of JSW Steel's proposed acquisition of Bhushan Power & Steel".

Through the proposed combination, JSW proposes to acquire 100 per cent of the equity shareholding and management control of Bhushan Power and Steel, according to the notice given by JSW Steel to the CCI.