The Supreme Court in its judgment on October 4 had granted an opportunity to ArcelorMittal and Numetal to clear dues for non-performing assets (NPAs) in two weeks to be eligible to bid for Essar Steel. The court had exercised its extraordinary power under Article 142 of the Constitution for the purpose.
Moreover, Numetal might have to pay for Ruia group companies that had been classified as NPAs for more than a year before the submission of resolution plan.
People in the know indicated that since the apex court had not found VTB to be ineligible, it was discussing with lawyers the option of moving an application seeking permission for a solo bid.
But whether VTB will clear Essar’s dues and make a pitch to take it out of bankruptcy is also not clear, though some lawyers indicated the resolution process would have to be closed.
A final call on whether VTB will go ahead with the option of filing an independent application for a solo bid, however, was yet to be taken, the people added. The Supreme Court will take a break for Dussehra shortly, and by the time it reopens, the 14-day deadline would have ended. Therefore, VTB will have to take a call soon, the people said.
If VTB makes a pitch for a solo bid, it is likely that JSW Steel — which was an investor in the operating company of Numetal in the second bid for Essar — will also go alone.
JSW Steel's Joint Managing Director and Group Chief Financial Officer Seshagiri Rao told media persons during the International Conference on Minerals and Metals that JSW Steel was seeking legal opinion on whether it could bid solo if fresh bids were allowed.
JSW Steel had earlier, too, wanted to go solo. However, the committee of creditors for Essar had not allowed it.
Meanwhile, lenders said the lead bank had started collecting information on Essar dues from other lenders in the consortium. A core banking group had met last Friday to discuss the Supreme Court judgment.
Apart from Numetal and Arcelor, Vedanta is also a resolution applicant in the second bid. In the second round, the offers are: Arcelor's revised bid stands at Rs 420 billion, Numetal has proposed to match it and Vedanta has offered Rs 350 billion.