Electrosteel’s lenders decide to support offer by Vedanta

KOLKATA: The lenders of Electrosteel Steels (ESL) on Thursday determined to head ahead with the Anil Agarwal-led Vedanta’s bid following a six-hour assembly right here within the town.

The Dalmias-owned Renaissance Steel had challenged the eligibility of Vedanta along with Tata Steel under clause 29A of the Insolvency and Bankruptcy Code (IBC), 2016, after Vedanta changed into the absolute best bidder (H1) for ESL.


The SBI-led consortium of 29 banks would possibly factor a letter of intent (LoI) to Vedanta next week. The lenders’ decision could be conveyed to the National Company Law Tribunal (NCLT) throughout its next hearing on Monday. The overall publicity of the lenders in ESL is around Rs 11,300 crore.

Sources in Renaissance Steel stated it's still now not convinced about the eligibility of Vedanta in step with the IBC clause. However, it's but to take a decision on its next transfer.

The solution skilled (RP) within the ESL insolvency case, Dhaivat Anjaria — who is a spouse at PwC, submitted on Thursday a proof as to why he felt Tata Steel and Vedanta were eligible for the bid along with the response of Renaissance Steel.

The NCLT had directed on March 20 the RP to present a replica of his decision to make Vedanta H1 along with the explanation as to why he felt that the Anil Agarwal firm and Tata Steel are eligible for bidding. NCLT had also asked the RP to submit a replica of his decision along with the objections from the Dalmia crew firm to its committee of creditors (CoC). Sources stated, “Now CoC has to take a view. The next hearing for this example is due on April 2. Prior to that, creditors have to form an opinion.” The Dalmia-led company alleged that both Vedanta and Tata Steel were not eligible to bid for the corporate under clause 29A of the IBC as one provision of this phase says any company which has executives who have been convicted for any punishable offence with imprisonment of two years or extra under the Companies Act would now not be eligible to apply. The Dalmias have claimed that both corporations — Vedanta and Tata Steel — come under this criterion.

The ongoing controversy could have impacted other bids of Tata Steel and Vedanta the place they're frontrunners or are collaborating. Vedanta used to be declared the H1 at the Electrosteel Steels bidding, while Tata Steel used to be declared the absolute best bidder for Bhushan Steel. They are also within the fray for assets of Essar Steel. The liquidation worth of Electrosteel Steels is Rs 2,900 crore.