JSW Steel gets letter of intent for acquiring Asian Colour Coated Ispat

JSW Steel said Saturday it has received the letter of intent from the committee of creditors of Asian Colour Coated Ispat Ltd for acquiring the debt-ridden firm through the insolvency process.

The lenders of Asian Colour Coated Ispat Ltd last week had approved JSW Group's Rs 1,550-crore bid to acquire the steel firm.

JSW Steel in a regulatory filing said that its wholly-owned subsidiary JSW Steel Coated Products Limited (JSWSCPL) had submitted a resolution plan for Asian Colour Coated Ispat Limited (ACCIL).

"The Committee of Creditors of ACCIL has issued a Letter of Intent dated July 6, 2019 to JSWSCPL and the same has been accepted by JSWSCPL," the filing said.

The closure of the transaction shall be subject to obtaining necessary approval from the National Company Law Tribunal, New Delhi, it said.

ACCIL went into insolvency in July last year after the National Company Law Tribunal (NCLT) admitted an application by SBI to initiate Corporate Insolvency Resolution Process (CIRP) for the company.

The Resolution Professional (RP) appointed to carry out the insolvency process was Kuldip Bassi, supported by EY. The total admitted debt in the resolution process was around Rs 6,500 crore.

To acquire ACCIL, JSW has offered Rs 1,550 crore, almost all of which will go to financial creditors.

SBI, Bank of Baroda and IDBI Bank are the main lenders, along with some other banks and financial institutions.

ACCIL is a steel products manufacturing company and has plants near Delhi and Mumbai with an annual capacity of one million tonnes.

The company specialises in downstream, galvanised and colour-coated products which are exported to Europe, Latin America and Africa.

Last year, a JSW Steel-led consortium had acquired majority stake in Monnet Ispat and Energy Ltd for Rs 2,875 crore under the Insolvency and Bankruptcy Code.