New Delhi: It seems like ArcelorMittal (AM) is inching closer to acquire the debt-hit Essar Steel with the National company Law Appellate Tribunal (NCLAT) on Monday giving a conditional approval to Rs 42,000 crore resolution plan of the world’slargest steelmaker for Essar Steel. However, the NCLAT nod will be subject to its final order in the appeal filed by the promoters.
There is no stay on the Resolution Professional (RP) of Essar Steel to disburse the funds among financial and operational creditors of the company, the tribunal said. “The RP will be the chairperson of the monitoring committee and will act in accordance with law to ensure that the company is a going concern,” it added. NCLAT will also look into the issue of discriminatory distribution of the funds between financial and operational creditors.
It has also asked the Insolvency & Bankruptcy Board of India (IBBI) to submit a ratio of distribution of funds between the concerned creditors. ArcelorMittal’s resolution proposal provides financial creditors Rs 41,987 crore out of their total dues of Rs 49,395 crore. Operational creditors, under the plan, would get just Rs 214 crore against the outstanding of Rs 4,976 crore. If the ArcelorMittal plan is implemented, Standard Chartered will only get Rs 60 crore against its claims of Rs 3,187 crore from Essar Steel.
