Anil Agarwal, billionaire and chairman of Vedanta Resources Plc, gestures as he speaks during a Bloomberg Television interview (Photographer: Simon Dawson/Bloomberg)

Anil Agarwal Indicates He Is Open To Raising Bid For Essar Steel

Billionaire industrialist Anil Agarwal has indicated that he’s open to raising bid for acquiring Essar Steel, saying his flagship Vedanta Ltd. is the best suited to take over the indebted firm due to the obvious synergies.

“As far as we are concerned, we are definitely interested but I never wanted to get into a fight. I have enough and I am happy. I have not gone to court. I have never made noise (on acquiring Essar Steel),” Agarwal said in New Delhi. Asked if he would be open to raising the offer price, he said: “I am open to everything.”

Agarwal said Vedanta’s Rs 35,000-36,000 crore offer in the first round of bidding for Essar Steel was the highest in the three-way race for the asset that lenders are auctioning to recover about Rs 50,800 crore of overdue loans. But during the legal battle over the eligibility of ArcelorMittal and NuMetal, the VTB Capital-based special purpose vehicle raised the offer to Rs 37,000 crore in the second round which subsequently was bettered by ArcelorMittal to Rs 42,000 crore. NuMetal has said it will match the ArcelorMittal's offer.

Also read: The Race For Essar Steel Narrows To Two Players

The issue has reached the Supreme Court which asked ArcelorMittal and NuMetal to pay off loans for group companies in India to be eligible to bid. “See the Court has clearly said that the first round of bid will be the basis and it has allowed all three bidders to come into the ring. ArcelorMittal has to pay dues to come in the ring and NuMetal has to pay the outstanding loan to come into the ring,” Agarwal said.

He said Vedanta is the best-suited company to take over Essar Steel as it produces iron ore - the raw material for making steel. Also, it produces natural gas which is used in the steel making process.

I am an iron ore producer, I am a natural gas producer, both of which will be of advantage to Essar...I continue to be interested in Essar Steel.
Anil Agarwal, Chairman, Vedanta

Vedanta, he said, remains eligible with its first round of bids. Once the condition set by the Supreme Court are met, the Committee of Essar Steel Creditors will take a view on the bids received.

Agarwal said he has already set foot in steel manufacturing through a Rs 5,320 crore acquisition of Electrosteel, a firm that too was auctioned to recover unpaid loans. “For us, steel making is a natural progression from being an iron ore producer.”

Essar Steel has emerged as the most sought-after asset in the government’s crackdown on delinquent borrowers. Of a dozen loan defaulters that have been pushed into bankruptcy proceedings, Essar Steel is perhaps the most bitterly fought for.

Also read: Has The Ruia Family Finally Lost Essar Steel?