A consortium of US-based distressed assets investor CarVal Investors and Asset Reconstruction Company of India Ltd (Arcil) has moved a step closer to acquiring Uttam Value Steels Ltd and Uttam Galva Metallics Ltd.
The Committee of Creditors to the two units of Mumbai-listed Uttam Galva Steels Ltd have given their approval to a debt resolution packaging from the consortium, a senior executive at one of the lenders said.
“The committee gave its approval for the Rs 2,400-crore resolution package. Of this, Rs 650 crore will be paid upfront and the rest of the payment will be staggered over a period of five years, the executive said, asking not to be named.
The consortium of lenders, led by State Bank of India (SBI), has a total exposure of around Rs 6,100 crore to the two companies. This means the lenders are taking a haircut of around 60% on the twin stressed assets.
The bankruptcy resolution professional of two companies, Rajiv Chakraborty of PwC, now has until May 7 to get the plan of CarVal and Arcil approved by the National Company Law Tribunal (NCLT).
Email queries sent to Arcil and Chakraborty remained unanswered. CarVal could not be reached for comments.
CarVal had initially offered about Rs 2,000 crore for the assets. JSW Steel Ltd and the UK-based Liberty House had also earlier shown interest in bidding for the assets. However, only CarVal and a consortium led by stressed assets investor SSG Capital Management made the final bids.
The Mumbai bench of the NCLT had admitted bankruptcy resolution petitions for the two companies in August 2018. The companies were given 20 more days to complete the resolution process after the 270-day deadline ended on April 3.
