Essar Steel Re-Bidding Issue May Be Taken Up On Wednesday

Pending a decision on the eligibility of bidders for debt-laden Essar Steel Ltd., lenders and the insolvency resolution professional are likely to meet on Wednesday and take up the option of rebidding, people in the know said.

The meeting between the Committee of Creditors and the IRP may take a decision on the eligibility of ArcelorMittal's and Numetal's bid for bankrupt Essar Steel,one source said. Bids for Essar Steel were submitted on Feb. 12, and its been over a month with no decision on eligibility of the bidders.

While Luxembourg-based ArcelorMittal's partner is Nippon Steel & Sumitomo Metal Corp for the takeover, Russia's VTB Group used a Mauritius-based investment vehicle Numetal, where Rewant Ruia – Essar Group promoter Ravi Ruia's son – held 25 percent stake.

Also Read: Numetal Shareholders Write To Essar Steel Lenders Offering To Eliminate Ruia Connection

With an aim to debar promoters of defaulting firms, the government last year amended the Insolvency Bankruptcy Code including Section 29A which prohibits promoters or sister concerns of companies with non-performing assets from participating in the auctions.

Essar Steel was among the initial 12 companies identified by the Reserve Bank of India for insolvency proceedings. It has a loan exposure of Rs 37,284 crore.

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