ArcelorMittal’s wait for Essar Steel bankruptcy resolution has got longer with the NCLT verdict deferred to 19 February 2019, and the subsequent NCLAT hearing postponed to 28 February 2019. The Ahmedabad branch of the National Company Law Tribunal (NCLT) is now expected to give its verdict on ArcelorMittal’s resolution plan for Essar Steel by 19 February, PTI reported.
Further, NCLAT will hear the Essar Steel case on 28 February, TV news channels reported. Earlier, the National Company Law Appellate Tribunal (NCLAT) hearing was due for today ie 12 February, after NCLT was supposed to have given its verdict by 11 February. However, NCLT Ahmedabad has reserved its order.
Meanwhile, the company’s original promoters — the Ruia family — moved NCLAT on Monday ie 11 February against a previous NCLT order which dismissed Ruias’ resolution plan. NCLT Ahmedabad in January had rejected Ruias’ Rs 54,000-crore bid by calling it a “last minute entry”. Even though the Ruia family bid was supposed to take care of the operational creditors as well, Essar Steel’s Committee of Creditors (CoC) favoured ArcelorMittal’s bid of Rs 42,000 crore.
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Also, the Supreme Court on Monday had dismissed the petitions of operational creditors to stay the proceedings of bankrupt Essar Steel. The plea was based on ArcelorMittal’s bid being a “raw deal” for operational creditors. As many as 31 operational creditors find themselves stuck and had moved Supreme Court on various occasions to request to NCLT to hear their plea.
Essar Steel has long been caught up in the IBC proceedings. With over Rs 50,000 crore at stake, the company has been fought over by numerous bidders including Numetal, Vedanta group, JSW Steel Ltd and ArcelorMittal. However, after several rounds of bidding, only ArcelorMittal has remained in the game with its winning bid, whereas the Ruia family is trying to get the control back by topping up the offer.
The company, backed by Ruia family, went bankrupt in 2015 after facing fraud allegations and failing repayment of loans. The company signed for IBC proceedings in August of 2017. Essar case is one of the 12 large cases to be admitted under 2016 Insolvency and Bankruptcy code.