The National Company Law Tribunal asked lenders of Bhushan Power & Steel Ltd. to consider Liberty House UK’s bid for the insolvency-hit company at the next meeting of the Committee of Creditors.
Bids can be rejected only on substantive grounds, and not because of delays, the bench headed by Justice MM Kumar ruled today. The tribunal also extended the deadline for finalising the resolution plan by two months to June 23.
Liberty House had moved the NCLT after its bid for the Delhi-based steelmaker was rejected by lenders because it was submitted after the deadline passed. Liberty House had argued that its bid was submitted before the lenders had opened other bids. That, according to the company, should've put them in contention too.
Liberty House had also claimed that its bid was higher than other competing bids. Tata Steel Ltd. had put in a Rs 24,500-crore offer for Bhushan Power & Steel, while JSW Steel Ltd. made a Rs 13,000-crore bid, BloombergQuint reported earlier.
The counsel for Bhushan Power & Steel’s resolution professionals argued that Liberty House went silent mid-process and did no due diligence of the facilities before submitting the bid.
Between Nov. 18 and Feb. 13, despite repeated reminders by the resolution professional, Liberty House did not communicate the necessary information. The lawyer described it as “radio silence”.
Bhushan Power & Steel owes more than Rs 47,000 crore to lenders, according to information on its website. The company is one of the largest of the 12 stressed accounts identified by the the Reserve Bank of India for resolution under the new Insolvency and Bankruptcy Code.
Apart from Bhushan Power & Steel, Liberty House has also bid for Amtek Auto’s assets under the insolvency process.