New Delhi | Jagran Business Desk: Global steel giant ArcelorMittal on Friday said that it has initiated payment for acquisition of debt-ridden Essar Steel for Rs 42,000 crore. This comes after the Supreme Court cleared decks for acquisition of Essar Steel.

According to a CNBC-TV18 report, it has transferred a sum of about Rs 40,000 crore to the current account of Essar Steel's lead banker, State Bank of India to take over the debt-ridden company under the new Insolvency and Bankruptcy Code.

However, the ArcelorMittal has refused to comment on the issue. After the payment to the lenders, this will be the single-biggest recovery under the IBC.

Meanwhile, a source -- quoted by PTI -- said that the ArcelorMittal had kept the entire Rs 42,000 crore amount to be repaid in an escrow account, it did not immediately release it to the lenders after the November 15 Supreme Court order.

The Supreme Court, last month, had cleared decks for acquisition of Essar Steel after which the ArcelorMittal said it expects to complete the acquisition by the end of this year. The court had also set aside the July 4 National Company Law Appellate Tribunal (NCLAT) order giving equal status to financial creditors and operational creditors.

The company in a statement had said that the plan plan for Essar Steel India Ltd (ESIL) has been unconditionally approved by the Supreme Court and the approval of AMIPL's resolution plan is the final procedural step in ESIL's corporate insolvency process.

“Completion of the transaction is now expected before the end of the year. After completion, ArcelorMittal will jointly own and operate ESIL in partnership with Nippon Steel Corporation, Japan's largest steel producer and the third largest steel producer in the world, in line with the joint venture formation agreement signed by the two companies,” the company had said.

(With PTI inputs)

Posted By: Aalok Sensharma