Bankers said as the Indian economy is expected to witness a sharp fall in the coming months due to the coronavirus (Covid-19) pandemic, JSW Coated, a JSW Steel firm, has not made any payment till date for the acquisition. “We have received another offer which has agreed to give us a better price than JSW Steel. Hence, we have to call for expressions of interest (EoIs) again,” said a source close to the development.
A JSW Steel official said the company is still in the race and is awaiting NCLT
hearing scheduled for next month.
JSW Steel had emerged the highest bidder for the company in June last year with an offer of Rs 1,550 crore. In March, the National Company Law Appellate Tribunal (NCLAT) had excluded the lockdown period for counting of the ‘resolution process’ under Section 12 of the IBC. The debt resolution automatically was extended for the lockdown.
The ACCIL debt resolution is still pending in the NCLT
and is expected to come up for hearing in July. The company has plants in Maharashtra and Haryana with an annual capacity of 1 million tonnes. According to lenders, they have already received feelers from potential bidders to acquire the company and fresh bids will be called in.
Asian Coated is not the only company where the winning bidder is having second thoughts. Bankers said the pandemic has hit the expansion plans of several companies
as sales for one entire quarter collapsed. “There are no takers for good firms and the valuation offered is too less,” said a lender. Besides, many companies, which were announced as winners, now don’t want to acquire and want to re-negotiate,” he said. JSW Steel also won the race for Bhushan Power and Steel by offering Rs 19,700 crore to Indian lenders. It was in negotiations with lenders to close the transaction when Covid hit the country and a nationwide lockdown was announced.
JSW is also awaiting results of the litigation initiated against the acquisition by former Bhushan Power promoters. JSW has already acquired Monnet Ispat for Rs 2,875 crore in 2018 under the insolvency and bankruptcy (IBC) process.