Four investors have submitted a resolution plan to revive Electrosteel Steels Ltd.
Tata Steel Ltd., Vedanta Ltd., Abhishek Dalmia-promoted Renaissance Steel India Pvt Ltd. and a fund backed by Edelweiss Asset Reconstruction Company Ltd. submitted their respective resolution plans, the company said in a stock exchange filing today.
The company’s lending consortium will decide on the bids this week when they are scheduled to meet and discuss their options, a banker close to the development said requesting anonymity. The final decision on this account will set the tone for how the India’s banking system approaches insolvency resolutions and the level of haircut they will be willing to take.
The Kolkata-based steelmaker owes more than Rs 13,000 crore to its lenders – about Rs 5,000 crore to State Bank of India alone – according to information available on Electrosteel Steels’ website.
The Vedanta Group has submitted a bid worth Rs 4,500 crore for Electrosteel Steels, the highest among the four bidders, The Economic Times first reported on Tuesday citing unnamed sources.
In June last year, the Reserve Bank of India had created a list of 12 large corporate accounts, including the Kolkata-based steelmaker which were to be sent for resolution under the Insolvency and Bankruptcy Code, by their respective lenders.
Electrosteel Steels is the first of the 12 large cases where a final resolution plan has been submitted.
Apart from the list of 12 large accounts, the regulator had created a second list of 29 accounts in August, most of which are expected to be admitted under the insolvency process within this month.
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