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Will clear the liability, want to have a steel plant in India: ArcelorMittal tells SC

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IANS  |  New Delhi 

ArcelorMittal on Wednesday told the Supreme Court that it was ready to pay Rs 7,000 crore - a liability which one of its sister concerns is burdened with for having 29 per cent stakes in now beleaguered Uttam Galva and KSS Petron - as it wanted to have its presence in India's steel sector and also live harmoniously with the banks.

Telling the bench of Justice Rohinton Fali Nariman and Justice Indu Malhotra that it would pay Rs 7000 crore, ArcelorMittal said: "I don't want to fight with Committee of Creditors. I find the (Essar Steel) plant worthy. I don't have a steel plant in India, It is worth it."

The Committee of Creditors comprises 16 lender banks that have financed the Essar Steel.

However, senior lawyer Harish Salve, appearing for ArcelorMittal, said that the company is willing to pay Rs 7,000 crore dues if it emerged as the successful bidder, but not as a precondition to become eligible to bid.

Telling the court to consider the bid of Rs 42,000 crore plus Rs 7,000 crore, Salve said: "If I am not the highest bidder, I go home. If you apply law, apply the law and see where we end up."

He said that Rs 7,000 crore, was already lying in its escrow account.

Salve said this as the court asked him if they could jack up their offer noting that if they clear their liabilities then they are at par with the NuMetal.

Salve said that they had acquired a little over 29 per cent stakes in the Uttam Galva but their's was a passive presence and at no stage they were promoters of the company now with sagging fortunes.

Even as Salve dwelt on the passive role of steel baron Mittal's company in Uttam Galva, senior counsel Mukul Rohatgi appearing for NuMetal said that they were co-promoters of the company.

On Rohatgi's intervention, Salve said: "Of course we had that right. We never exercised them. I never stepped into the shoes of promoters. I was never on the board or exercised voting rights."

Salve took exception to NCLAT holding that the stigma of NPA attached to KSS Patron cannot be cleared by KSS Global' by divesting its shares in 'KSS Petron' on 9th February, 2018.

The paragraph of NCLAT's September 7, 2018 judgment that troubled petitioner ArcelorMittal said: " Therefore, we hold that L.N. Mittal Group, a connected person of 'AM India Ltd.' being the promoter and in the control and management of 'KSS Petron' since 2011 and 'KSS Petron' having classified as 'NPA' by multiple banks, the stigma attached to it cannot be cleared by 'KSS Global' by divesting its shares in 'KSS Petron' on 9th February, 2018..."

It further said that ace... the stigma will continue for the purpose of ineligibility under clause (c) Section 29A, till the payment of all overdue amount with interest thereon and charges relating to NPA account of 'KSS Petron'.

Justice Nariman said "it is upsetting and is not correct at all".

In a counter attack on rival NuMetal, Salve described it as a Shell Company that was set up just seven days before it entered the field to bid for financially beleaguered Essar Steel facing insolvency.

Pointing to the holes in NCLAT judgment, he said that the Russia's VTB Bank backed Numetal's Rs 37,000 crore bid was accepted by the appellate tribunal without any riders.

He described as "highly unusual" the Russian bank's backing for the takeover of a sick Indian company.

He said on account of sanctions by the EU in the wake of Russia's annexation of Crimea, the Russian bank was barred from advancing any credits or trading or raising any capital from the market.

He said that the EU directives are enforceable here in India.

Meanwhile, NuMetal too has moved the court challenging three days time given by NCLAT to ArcelorMittal to deposit Rs 7000 crore to become eligible to bid.

Hearing on ArcelorMittal's appeal will continue on Thursday.

--IANS

pk/ahm/sed

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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First Published: Wed, September 12 2018. 21:14 IST
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