Reeba Zachariah & Sidhartha | TNN
Mumbai/New Delhi: A day after
Tata Steel received the nod from the National Company Law Tribunal (
NCLT
) to acquire
Bhushan Steel
, the promoter of the bankrupt company has filed a plea with the appellate tribunal
NCLAT
over the deal. The matter is listed for admission on May 17.
Though the grounds on which Bhushan Steel promoter Neeraj Singhal has made the appeal couldn’t be ascertained, Tata Steel said that it will contest the case. Tata Steel has offered Rs 35,200 crore for a 73% stake in Bhushan Steel, the first domestic metal company that served the automotive sector.
Lenders will hold 12% in the company by converting a part of the debt into equity, while Singhal’s stake is expected to come down from 8% to 2% after the completion of the transaction.
The proposed acquisition is expected to increase Tata Steel’s debt, which as on March 31 was Rs 92,147 crore. Tata Steel said that it intends to retain 5,000 employees of Bhushan Steel, which has a 5.6-million-tonne capacity. On the bankruptcy proceedings, Tata Steel CFO Koushik Chatterjee said it has been a learning experience for all stakeholders with the company seeing parties “interfering, delaying, postponing” the process. “If the bids are right, the judiciary will see through this.”
Besides Bhushan Steel, Tata Steel is fighting a legal battle with UK’s
Liberty House
over the bankrupt
Bhushan Power
and Steel. The company had earlier shown interest in the debt-ridden Electrosteel Steels, but lost the race.
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Reeba Zachariah is assistant corporate editor at The Times of Ind...
Read MoreReeba Zachariah is assistant corporate editor at The Times of India, Mumbai. She has been covering large Indian business houses such as the Tata Group. She also reports on a host of sectors like hospitality, retail, travel, liquor and consumer durables. She has been writing on mergers and acquisitions and private equity.
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