A worker welds at a construction site near the JSW Steel Ltd. manufacturing facility in Dolvi, Maharashtra. (Photographer: Dhiraj Singh/Bloomberg)

JSW Steel Seeks Legal Opinion On Bidding Solo For Essar Steel

JSW Steel Ltd. is seeking a legal opinion if it can bid solo for the stressed assets of Essar Steel Ltd., a top company official said today.

When asked if JSW Steel is mulling going solo for acquiring stressed assets of Essar Steel if fresh bids were allowed, JSW Steel Joint Managing Director Seshagiri Rao said that it would depend on legal opinion and the view of the committee of creditors.

"It depends upon the legal opinion and the view of the Committee of Creditors and the Resolution Professional. If they take a positive view, then we are open to look at it," he told reporters in Delhi at the International Conference on Minerals and Metals. "We are seeking a legal opinion and based on that opinion we will take a call."

At that time when the second round of bidding was happening, JSW Steel was looking at submitting the bid alone. We weren’t permitted. So, we have to see what view CoC and the Resolution Professional will take in the light of the Supreme Court judgement.
Seshagiri Rao, Joint Managing Director, JSW Steel.

JSW Steel had teamed up with NuMetal to place a Rs 37,000-crore offer for Essar Steel in the second round of bidding.

NuMetal and ArcelorMittal were the only two parties that bid to buy out Essar Steel in the first round, but the resolution professional was advised to reject both the bids owing to their promoters being linked to defaulter companies.

The Supreme Court had last week granted one more opportunity to steel and mining major ArcelorMittal and Russia's VTB Bank-promoted NuMetal to bid for Essar Steel, provided the two pay off the non-performing assets of their related corporate debtors within two weeks.

Also read: Essar Steel Case: Important Precedents Laid Down By The Supreme Court

As per the judgement, ArcelorMittal would qualify to bid for Essar Steel only if it clears the Rs 7,000 crore dues of two firms, Uttam Galva and KSS Petron, it was previously associated with.

With regard to NuMetal, it has not specified NPAs of its related corporate debtors which have to be paid off to become eligible to bid for corporate debtors Essar Steel, which had NPAs or bad debts amounting to Rs 45,000 crore.