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Steel manufacturer ArcelorMittal joins bid to acquire debt-ridden Srei

Steel manufacturer ArcelorMittal joins bid to acquire debt-ridden Srei
Steel manufacturer ArcelorMittal joins bid to acquire debt-ridden Srei

Arcelor Mittal Nippon Steel Ltd., the biggest steel manufacturer in the world, has expressed interest in buying two debt-ridden Srei Group companies, intensifying the competition for their acquisition.

In order to acquire the two companies Srei Equipment Finance Ltd. (SEFL) and Srei Infrastructure Finance Ltd. (SIFL), which are going through a resolution process under the Insolvency and Bankruptcy Code, the steelmaker has submitted an expression of interest (EOI).

Among other bids are Varde Partners and Arena Investors LP, as well as investors Rajesh Viren Shah and Shon Randhawa.

Given that Varde-Arenas joint bid amounts to USD 18 million as the earnest deposit money (EMD), their bid for Srei Infrastructure Finance and Srei Equipment Finance is more serious than the Shon Randhawa consortiums, which has attached conditions to the EMD. They recommended adding two provisions to the resolution plans parameters.

Notably, since last October, the Srei Group has been able to recoup roughly USD 256 million under Rajneesh Sharma, the RBI-appointed administrator. For those unversed, the administrator disclosed creditor claims totaling USD 402 million and has so far identified a number of transactions with a combined value of roughly USD 6100 million as fraudulent.

According to sources, in March, 14 bidders expressed their interest in purchasing Srei Group enterprises under the Insolvency and Bankruptcy Code (IBC).

It is worth noting that the boards of SIFL and its wholly owned subsidiary SEFL were replaced by the Reserve Bank of India in early October of 2022.

In other news, Nippon Steel Corporation, a Japanese company, has recently announced that an Indian joint venture with ArcelorMittal S.A. will infuse USD 5 billion to increase the production capacity of its rude steel Hazira plant by 6 million tons annually.

In the Hazira factory in western India, the collaboration will lead to a construction of two blast furnaces in addition to numerous other facilities, with intentions to begin operations by mid-2026.

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Aakriti Rao

Aakriti Rao

Aakriti Rao has always had a flair to pen down crisp and quirky content. A qualified English Literature graduate, Aakriti’s forte lies in creating content for varied genres in an utmost interactive way. Presently, she works as a content developer and writes articles spanning the latest business trends, market research, and industry news for Cue Report.