ArcelorMittal and Essar Steel continue to fight

[ad_1]
<div _ngcontent-c14 = "" innerhtml = "

Baron of steel Lakshmi Mittal has been on a long way to enter the Indian market. And this trip is not over yet.

ArcelorMittal, the largest steelmaker in the world, made a bid last year for Essar Steel, a bankrupt company controlled by billionaires Shashi and Ravi Ruia. The purchase, if any, will help Mittal finally enter the Indian market, a goal long awaited by the billionaire.

While Mittal, based in London, was approaching the victory, a court on Thursday asked his company to consider revising its offer, but it also allowed the family Ruia to present his own offer and possibly resume the control of the debt. company charged.

The National Court of Appeals of Company Law (NCLAT), a quasi-judicial body that decides on issues relating to Indian companies, make his observations hearing a call from Shashi Ruia's son, Prashant, who seeks to overturn the & nbsp;approval of & nbsp; ArcelorMittal;A takeover bid by Essar Steel of 42,000 crores ($ 5.9 billion).

NCLAT asked ArcelorMittal why it should not increase its offer on Essar Steel, although the & nbsp;ArcelorMittal & nbsp;m said In court on Friday, he intended to stick to his earlier offer as they had set the value of the company at Rs 42,000 crore.

During the same hearing, NCLAT also stated that Ruias could be eligible to bid for their business provided that they & nbsp;cleared all bad debts for their group, including that of Essar Steel, amounting to about Rs 1.4 billion ($ 18 billion). The court granted the family a week to review the offer.

At one point, the judge would also have told Essar's attorney that, even though he was hearing his client's plea, he seemed to be arguing. "a rotten case. "

Last week, the National Company Law Tribunal, another quasi-judicial body, ruled against the Ruia family & nbsp;offer to pay& nbsp; Rs 54,389 crore ($ 7.6 billion) & nbsp; in favor of Mittal's offer.

In addition to the Ruias, one of Essar's creditors, Standard Chartered Bank, had also filed an appeal with NCLAT to challenge the earlier ruling in favor of ArcelorMittal's offer. The bank, according to media reports, alleged in the regulation a discrimination that would require it to accept a steep discount if Essar Steel is sold to ArcelorMittal at the current price of & nbsp;Rs 42,000 crore.

Essar Steel has been bankrupt since the summer of 2017. ArcelorMittal made its bid for the company last February. As part of a joint venture with the Japanese Nippon Steel & amp; Sumitomo Metal Corp., & Nbsp;ArcelorMittal& nbsp; has offered an initial payment of $ 5.9 billion, which will serve to resolve Essar's debts, and will also inject an additional amount & nbsp; Rs 8,000 crores ($ 1.1 billion) to improve operations and increase production.

A spokesman for ArcelorMittal declined to comment on the procedure.

The spokesperson of Essar Steel said: "We continue to believe that our settlement proposal of 54,389 crores of rupees is the most convincing for Essar Steel's creditors. and& nbsp; fills [Insolvency and Bankruptcy Code’s] declared the primary objective of maximizing value. "He did not respond to a request for comment on NCLAT's offer to the Ruia family to settle all bad debts in order to be able to make an offer on Essar Steel .

Despite this long and arduous journey, ArcelorMittal, already present in 60 countries and generating a profit of 5.1 billion dollars in 2018 for a turnover of 76 billion dollars, does not abandon its bid on Essar.

The reason is quite simple: India, which is already the world's second largest steel producer after China, is expected to be the fastest growing steel market in terms of consumption and produced over the next two decades, says Yulia Buchneva.Associate Director, Natural Resources and Commodities EMEA, at Fitch Ratings in London.

"The Indian steel market is very lucrative from a growth perspective," Buchneva said.

For ArcelorMittal, which has been studying various options for more than a decade to enter India, the Essar Steel plant is "not a bad plant," Peter added. Archbold, Global Head of Metals and Mining at Fitch Ratings.

With a production capacity of 10 million tons of steel, Essar Steel is the fourth largest in the country, although it produces barely half at present due to bottlenecks. Strangulation, said the two badysts. ArcelorMittal has announced plans to increase production at the plant.

">

Baron of steel Lakshmi Mittal has come a long way to enter the Indian market. And this trip is not over yet.

ArcelorMittal, the largest steelmaker in the world, made a bid last year for Essar Steel, a bankrupt company controlled by billionaires Shashi and Ravi Ruia. The purchase, if any, will help Mittal finally enter the Indian market, a goal long awaited by the billionaire.

While Mittal, based in London, was approaching the victory, a court on Thursday asked his company to consider revising its offer, but it also allowed the family Ruia to present his own offer and possibly resume the control of the debt. company charged.

The National Court of Appeals (NCLAT), a quasi-judicial body that adjudicates matters relating to Indian companies, made its submissions on hearing the appeal of Shashi Ruia's son, Prashant, who seeks to reverse the ArcelorMittal approval A takeover bid by Essar Steel of 42,000 crores ($ 5.9 billion).

NCLAT asked ArcelorMittal why it should not increase its offer on Essar Steel, although ArcelorMittal declared in court Friday that he had intended to stick to his earlier offer as they had established the value of the company at 42,000 crore Rs.

During the same hearing, NCLAT also stated that the Ruias could be eligible to bid for their business provided cleared all bad debts for their group, including that of Essar Steel, amounting to about Rs. 1.4 billion crore lakh ($ 18 billion). The court granted the family a week to review the offer.

At one point, the judge would also have told Essar's lawyer that, if he heard his client's plea, he appeared to plead "a rotten case".

Last week, the National Company Law Tribunal, another quasi-judicial body, voted against the Ruia family's offer to pay 54,389 crore rupees ($ 7.6 billion) in favor of Mittal's offer.

In addition to the Ruias, one of Essar's creditors, Standard Chartered Bank, had also filed an appeal with NCLAT to challenge the earlier ruling in favor of ArcelorMittal's offer. According to the press, the bank allegedly discriminated in the regulation which would require it to accept a steep discount if Essar Steel was sold to ArcelorMittal at the current price of Rs 42,000 crore.

Essar Steel has been bankrupt since the summer of 2017. ArcelorMittal made its bid for the company last February. In partnership with Japanese companies Nippon Steel and Sumitomo Metal Corp. ArcelorMittal has offered an initial payment of $ 5.9 billion, which will be used to resolve Essar's debts, and will also inject an additional Rs. 8,000 crore ($ 1.1 billion) to help improve operations and the increase in production.

A spokesman for ArcelorMittal declined to comment on the procedure.

The spokesperson of Essar Steel said: "We continue to believe that our settlement proposal of 54,389 crores of rupees is the most convincing for Essar Steel's creditors. and fills [Insolvency and Bankruptcy Code’s] declared the primary goal of maximizing value. "He did not respond to a request for comment on NCLAT's offer to the Ruia family to settle all bad debts in order to be able to make an offer on Essar Steel.

Despite this long and arduous journey, ArcelorMittal, already present in 60 countries and generating a profit of 5.1 billion dollars in 2018 for a turnover of 76 billion dollars, does not abandon its bid on Essar.

The reason is quite simple: India, which is already the world's second largest steel producer after China, is expected to be the fastest growing steel market in terms of consumption and produced over the next two decades, says Yulia Buchneva.Associate Director, Natural Resources and Commodities EMEA, at Fitch Ratings in London.

"The Indian steel market is very lucrative from the point of view of growth," said Buchneva.

For ArcelorMittal, which has been considering various options for more than ten years to enter India, the Essar Steel plant is "not a bad factory," added Peter Archbold, Global Head of Metals and Mining at Fitch Ratings.

With a production capacity of 10 million tons of steel, Essar Steel is the fourth largest in the country, although it produces barely half at present due to bottlenecks. Strangulation, said the two badysts. ArcelorMittal has announced plans to increase production at the plant.