| Work Detail |
The National Company Law Tribunal today approved a Rs 2,875-crore bid by a consortium of Aion Investments Pvt. Ltd. and JSW Steel Ltd. to acquire the bankrupt Monnet Ispat & Energy Ltd.
The Aion-JSW consortium was the sole bidder for the 1.5 million tonne asset in Chhattisgarh, JSW said in a media statement. It added that the detailed NCLT order is awaited as the tribunal gave a verbal order today with some modifications to the original bid.
It is not immediately known what modifications the tribunal has sought to the original bid. When contacted, JSW Steel refused to elaborate stating they are awaiting the detailed order.
The bankrupt Monnet owes over Rs 11,000 crore to a clutch of lenders. This means that banks and other financial creditors will take a massive 74 percent haircut as the bid is worth only three-fourths or 26 percent of the dues.
The consortium had earlier discussed points pertaining to operational creditors’ dues and small shareholders, sources said, adding there may be some more modifications which will be known in the written order.
The acquisition of Monnet Ispat is expected to help JSW Steel consolidate its position in eastern markets.
Monnet Ispat ran a successful coal-based sponge iron plant with an annul capacity of 1.5 million tonne in Chhattisgarh. The company ran into problems when the coal mines attached to the plant were cancelled in 2014 after a Supreme Court order. Crashing steel prices on account of Chinese dumping further aggravated matters and resulted into bankruptcy proceedings.
Monnet was one of the 12 accounts that the Reserve Bank of India had identified in its first list tagged as the ‘dirty dozen’ for an immediate resolution mid-last year.
|
