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ArcelorMittal’s Essar Steel win may result in Rs 1,150cr loss for Gujarat govt: Report

5 November, 2018 4:19 AM
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ArcelorMittal’s Essar Steel win may result in Rs 1,150cr loss for Gujarat govt: Report

The Gujarat government stands to lose around Rs 1,150 crore if the National Company Law Tribunal (NCLT) upholds the committee of creditors’ recommendation to accept ArcelorMittal’s resolution plan to acquire Essar Steel, a Mint report states.

These dues are classified as operational creditors and ArcelorMittal’s proposal does not make any provision for payment to such creditors, the report suggests.

Essar Steel owes around Rs 1,150 crore to a number of state government companies including Rs 872 crore to Gujarat Energy Transmission Corporation.

According to the resolution plan’s details, the dues pertain to various agencies of the Gujarat government including collector of electricity duty, sales tax department, local authorities and state maritime regulator.

The resolution plan proposes upfront payment of Rs 42,000 crore to lenders. Additionally, it proposes payment of Rs 8,000 crore towards capital expenditure. The total admitted claims of operational creditors is around Rs 4,995 crore. ArcelorMittal has offered to settle it at Rs 214 crore.

Source: moneycontrol.com

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