Financial Express, citing legal sources close to the development, reported that Numetal is likely to challenge Essar Steel’s committee of creditors’ (CoC) decision that it will have to repay existing debt of Essar Steel before being considered eligible to bid for the bankrupt steelmaker in a higher court.
A Numetal spokesperson said “Numetal is a fully eligible resolution applicant as per the Insolvency and Bankruptcy Code, 2016 (IBC). Neither Numetal nor its shareholders have any loans overdue with any creditors in India. Aurora, which had minority shareholder interest with 25% equity in Numetal, neither had management role nor any right to directorship in the company. Neither Aurora nor its beneficiary has any loan irregularities with Indian lenders and banks. In any event, Numetal’s other shareholders have already bought out Aurora’s shareholding in the company.”
On Tuesday, the CoC notified both Numetal and ArcelorMittal that they would have to clear all existing dues within a week before their bids are considered to be eligible. Financial creditors have claimed close to INR 49,000 crore from Essar Steel. Although it could not be confirmed how much Numetal would have to pay to make itself eligible, sources estimate it could be around INR 40,000 crore. ArcelorMittal may have to pay around INR 7,000 crore.
Numetal’s bid was held to be ineligible since one of the persons associated with the company, Rewant Ruia, is related to the promoters of Essar Steel. The shareholders of Numetal include Russia’s VTB Bank and engineering firm Tyazhpromexport, financial investor Aurora Enterprises (in which Ruia has an interest) and commodity trading company Indo International Trading.
Source : FINANCIAL EXPRESS