NCLT clears ArcelorMittal’s resolution plan for Essar Steel

The Ahmedabad bench of National Company Law Tribunal (NCLT) has today reportedly cleared ArcelorMittal’s Rs 42,000 crore resolution plan for Essar Steel, 583 days after it was admitted into the tribunal for insolvency proceedings, far beyond the prescribed 270-day deadline..Essar Steel is one of the 12 large cases referred by the Reserve Bank of India for insolvency proceedings. Undoubtedly, it has been one of the most dramatic episodes of the Insolvency and Bankruptcy Code..Last October, a committee of Essar Steel creditors had picked ArcelorMittal and Nippon Steel joint venture to acquire the 10-million tonne steel mill for over Rs 42,000 crore. The National Company Law Appellate Tribunal (NCLAT) had earlier also directed the NCLT Ahmedabad bench to take a decision on the resolution plan submitted by ArcelorMittal by March 8. But the original promoters, the Ruias made a counter bid with Rs 54,384 crore offer later and was rejected by the lenders and the resolution professional..On January 29, NCLT Ahmedabad rejected the debt settlement proposal put forth by the shareholders of Essar Steel saying that its jurisdiction was restricted by the NCLAT and Supreme Court, to only consider the resolution plans. In the event the resolution plans didn’t get the requisite vote, liquidation would take place..The Ruias have made several attempts to regain control over the Essar Steel, but have been unsuccessful so far. After NCLT’s decision today, NCLAT would hear the matter from 14 March onwards..Further retaliation is expected..Bar & Bench is available on WhatsApp. For real-time updates on stories, Click here to subscribe to our WhatsApp.