NCLT Ahmedabad bench clears ArcelorMittal’s resolution plan for takeover of bankrupt Essar Steel

Ahmedabad: The Ahmedabad bench of National Company Law Tribunal (NCLT) today cleared steel major ArcelorMittal’s Rs 42,000 crore resolution plan for debt ridden Essar Stee’sl takeover.

The L N Mittal led ArcelorMittal was trying to acquire bankrupt Essar Steel , which has a 10MTPA steel plant in the western state of Gujarat, since 2017.Committee of Creditors in October last year but was challenged before the National Company Law Appellate Tribunal (NCLAT) which had directed the NCLT Ahmedabad bench to take a decision on it by today ie March 8.

Earlier, on January 29, NCLT bench here had rejected the Rs 54389 crores higher debt settlement proposal put forth by the shareholders of Essar Steel, Essar Steel Asia Holding saying the offer violates Section 12A of the Insolvency and Bankruptcy Code and was not maintainable despite being higher in amount that that of ArcelorMittal’s bid.

The NCLT had said that Rs 54,389-crore offer by Essar Steel Asia Holding, which is much higher than the ArcelorMittal’s Rs 42,000 crore bid, is not maintainable as the only way to make a proposal is through Section 12A.

If the other was not challenged by the Essar promoters then the NCLT order would pave way for the take over of the company by AreclorMittal.

Meanwhile, ArcelorMittal in a statement has welcomed the order of the NCLT saying that it hoped to complete the transaction as soon as possible.

The Essar promoters were likely to challenge the NCLT order.