Lenders to pick from Liberty house, Tata Steel and JSW Steel for Bhushan Power sale
21 July 2018
The National Company Law Appellate Tribunal (NCLAT) on Friday gave the go-ahead to lenders of bankrupt Bhushan Power and Steel to go ahead with finalising a bid for the company.
The Committee of Creditors (CoC) will now choose from among the three bidders - Tata Steel, Liberty House and JSW Steel – that have submitted bids for the company which is under the insolvency and bankruptcy process.
The resolution process of BPSL comes months after group company Bhushan Steel was acquired by Tata Steel, in the first among the 12 non-performing accounts placed under IBC.
In the case of BPSL, however, Liberty House is reported to have quoted a bigger sum that Tata Steel.
Bhushan Power and Steel (BPSL) is among the 12 bad loan accounts that add up to 25 per cent of India’s total non-performing loans, that the RBI had picked up for immediate resolution last year. The company owes lenders about Rs37,248 crore.
Although a late bidder, the NCLAT has asked the CoC to consider Liberty House’s bid, which is the highest, and select the best among the three plans, not just the highest. The choice now depends on the lenders, as per section 30(2).
Of the 12 big accounts red-flagged by the RBI, two accounts - Bhushan Steel and Electrosteels Steel - have been resolved while Monnet Ispat has got the final nod for the sole bid submitted by AION Capital-JSW Steel consortium.
In the case of Alok Industries, Reliance Industries-JM Financial ARC have emerged the highest bidder. The other seven accounts are at different stages of resolution. So far, the steel industry has witnessed the most successful resolution.