Tata Steel highest bidder for Bhushan
Calcutta: Tata Steel Ltd has been formally identified as the highest bidder for Bhushan Steel Ltd, the company said in a filing with the stock exchanges this evening.
The company's bid was higher than JSW Steel, which had also bid for the stressed asset through a National Company Law Tribunal-led process.
"Tata Steel Limited hereby informs that it has received a formal communication from the resolution professional of Bhushan Steel Limited (BSL) that it has been identified as the highest evaluated compliant resolution applicant to acquire controlling stake of BSL under the corporate insolvency resolution process (CIRP) of the Insolvency and Bankruptcy Code 2016 (IBC), as decided in the meeting of the committee of creditors (CoC) of BSL on March 6, 2018," Tata Steel informed the bourses.
Tata Steel had offered to pay around Rs 36,000 crore to the lenders of Bhushan Steel, which owes financial institutions around Rs 56,000 crore.
"The advisers to the CoC and the resolution professional of BSL are currently in discussions with Tata Steel on the resolution plan. The next steps in the process will be as per the stipulations under the CIRP of the IBC," the company statement added.
If Tata Steel can overcome all the legal hassles that are likely to crop up before the completion of the transaction, the company will add close to 5.6-million-tonne steel making capacity to its portfolio.
Bhushan Steel, which focuses on value-added cold-rolled products used in the automobile and consumer durable industries, has a plant in Odisha where Tata Steel has built a new 3-million-tonne plant.
The Tatas have also announced further expansion of 5 million tonnes at its own site.
Though the news of Tata Steel becoming the highest bidder came after market hours, the Bhushan Steel stock plummeted 9.17 per cent, or Rs 4.10, to close near its 52-week low of Rs 40.60 on the Bombay Stock Exchange on Wednesday.
The Tata Steel scrip was also under pressure, ending at Rs 648, down by Rs 12.50 or 1.89 per cent, on the BSE.