Earlier, ArcelorMittal had submitted an offer for the company facing insolvency comprising an upfront payment of Rs 500 crore, which was rejected by lenders. Royale’s offer was believed to be lower. The committee of creditors (CoC) then decided to call for revised bids.
Sources said, Arcelor has submitted a revised package, inclusive of capital infusion, which amounted to more than Rs 2,000 crore. The upfront offer had been upped, they said. ArcelorMittal, however, declined to comment.
Royale, too, was understood to have submitted a revised offer. ECIL’s admitted claims from financial creditors stand at Rs 7,237.39 crore. Lenders were also interested in equity infusion apart from the upfront payment, sources said.
This is the second Ruia group firm that Arcelor has bid for after Essar Steel. The steel major’s interest in EPC also stems from the work that the company has historically done for Essar. EPC Constructions was involved in building the Hazira facility. That apart, it has decades of experience in project execution and delivery.
Arcelor emerged as the preferred bidder for Essar Steel in October. However, its resolution plan filed with the National Company Law Tribunal (NCLT) for approval, is pitted against a bid from the promoter group. The matter is being heard and a decision from the tribunal is expected by January 31. But even as a go-ahead from the NCLT is awaited, the global steel major appears to be working on getting its India act together.
It is already looking at taking ownership of Uttam Galva Steels, a downstream company, for which it had to clear debts to become eligible to bid for Essar.
Uttam Galva, a company it co-promoted, was classified as a non-performing asset for more than a year and according to the rules of the insolvency code, it made Arcelor ineligible. However, in keeping with the Supreme Court order, it cleared the dues related to defaulting firms to become eligible for Essar, which is an upstream facility.
Uttam Galva had a cold rolling capacity of 1.2 million tonnes and had a synergistic fit with Essar Steel. Also, Arcelor had submitted an expression of interest for Asian Colour Coated Ispat, another downstream unit, which was facing insolvency.
For more than a decade, ArcelorMittal had been trying to get a foothold in the Indian market. It had signed MoUs with the Odisha, Jharkhand and Karnataka governments for greenfield projects. However, none of the projects had taken off. Finally, Essar, through the IBC, threw up the opportunity that it was looking for.