The ArcelorMittal-Nippon Steel combine has transferred ₹38,896 crore to lenders for the acquisition of the once Ruias-owned Essar Steel in an insolvency-driven process.
The recovery comes over two years after the lenders initiated a corporate insolvency resolution process (CIRP) against the steelmaker.
The operational and other creditors will get the remaining ₹3,104 crore of the ₹42,000-crore bid placed by ArcelorMittal to settle Essar Steel’s loan default of ₹49,000 crore.
Under the initial plan, the operational creditors were supposed to get ₹196 crore. However, the National Company Law Appellate Tribunal (NCLAT) ordered the financial lenders to consider an additional payment.
Loan recovery
ArcelorMittal’s payment has resulted in a loan recovery of 89.74 per cent. The closure of the deal comes just ahead of the deadline for payment, which ends on Monday. The winning bidder had to make the payment within a month after the deal was approved, or shell out the interest for the delayed payment.
The Supreme Court approved ArcelorMittal’s bid for Essar Steel on November 15. The company’s new owners then sought immunity from the ongoing investigation against Essar Steel’s original promoters.
The government has amended the Insolvency and Bankruptcy Code (IBC) to ring-fence assets under IBC and the new owners from punitive actions, paving the way for ArcelorMittal, the world’s largest steel company, to enter India.
As on October 24 last year, 65 financial creditor claims totalling approximately ₹55,440 crore, 1,936 operational creditor claims totalling approximately ₹27,081 crore, employee/workmen claims of about ₹20 crore and one claim from ‘other creditors’ of about ₹24 crore were received, both electronically and physically.
The amount admitted in the case of financial creditors was ₹49,473 crore; operational creditors, ₹5,074 crore; and employees, ₹18 crore.
SBI’s exposure
Among the financial creditors, SBI had the highest amount admitted, at ₹13,226 crore. The admitted amount of the other large creditors include: Canara Bank (₹3,798 crore), Standard Chartered Bank (₹3,557 crore), Punjab National Bank (₹2,936 crore), Deutsche Bank (₹2,830 crore), IDBI Bank (₹2,482 crore), ICICI Bank (₹2,294 crore), Union Bank of India (₹2,123 crore), Bank of India (₹1,985 crore), EARC TRUST - SC 217 (₹1,698 crore) and Corporation Bank (₹1,567 crore).
While the recovery is good news for the banks in the third quarter, they may utilise the proceeds to make provisioning towards their exposure to Dewan Housing Finance Corporation Ltd and IL&FS, and mark-to-market provisioning towards investment depreciation.
SBI, which led the consortium of lenders to Essar Steel, tweeted that it has also made a recovery in 5.26 lakh accounts through one-time settlements since August 23, 2019.
The tweet, which tagged the Twitter handles of the Prime Minister’s Office and the Finance Ministry, said the recovery bears testimony to the bank's commitment to growth through profitability.
Default to Odisha Slurry
In separate insolvency proceedings, the lenders of Odisha Slurry Pipeline Infra, a critical asset for Essar Steel’s plant operations in Hazira, issued a Letter of Intent to ArcelorMittal, which agreed to pay the entire default of ₹2,350 crore. The 253-km pipeline carries iron ore slurry from Dabuna, Odisha to Paradip, where it is converted into pellets before being shipped to the Essar Steel plant in Hazira, Gujarat.
"steel" - Google News
December 15, 2019 at 05:37PM
https://ift.tt/2stYgXz
ArcelorMittal pays ₹38,896 crore to Essar Steel’s financial creditors - BusinessLine
"steel" - Google News
https://ift.tt/2YnEY1Z
Shoes Man Tutorial
Pos News Update
Meme Update
Korean Entertainment News
Japan News Update
No comments:
Post a Comment