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Essar Steel bid - ArcelorMittal alleges differential treatment in eligibility test

Steel News - Published on Mon, 16 Apr 2018

Business Standard reported that ArcelorMittal has alleged it received differential treatment in the eligibility test it failed in the first round of bidding for Essar Steel as compared to JSW Steel’s with respect to Monnet Ispat & Energy. The legal sources said while JSW’s case was similar to ArcelorMittal’s, the latter did not get the same treatment. The sources added that “The resolution plan submitted by JSW-AION was approved by the committee of creditors. Therefore, it is clear that the sale of shares by Jajodia prior to the submission of the resolution plan was considered sufficient by the resolution professional and creditors of Monnet Ispat for the purposes of Section 29A of the IBC (Insolvency and Bankruptcy Code).”

The case, as put forward by the legal sources close to ArcelorMittal, is somewhat like this: Seema Jajodia, who is a sister of JSW group chairman and managing director Sajjan Jindal and an erstwhile promoter of Monnet Ispat, had transferred her shares in Monnet Ispat on October 24, 2017, but continued to be reflected as a promoter in the shareholding pattern uploaded on the stock exchanges for the quarter ended December 2017. The Monnet Ispat bid was submitted on December 12, but the rectified shareholding pattern was uploaded on the stock exchanges on January 27.

ArcelorMittal was found to be ineligible in the first round of bidding for Essar Steel as it remained a promoter of Uttam Galva Steels in the records of the stock exchanges. Legal sources close to ArcelorMittal said the company had sought declassification from the stock exchanges prior to the submission of bid for Essar Steel, but the final nod came well after the submission. The Essar Steel bids were submitted on February 12, ArcelorMittal sought declassification on February 8 and stock exchange approvals came on March 21 and March 23.

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Posted By : Amom Remju on Mon, 16 Apr 2018
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