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Endgame: Bhushan Power CoC to pick winning bid today

The committee of creditors (CoC) of Bhushan Power and Steel are scheduled to meet on Tuesday to select the most preferred bidder for the bankrupt company as the deadline for submitting revised quotes ended on Monday midnight.

Endgame: Bhushan Power CoC to pick winning bid today
Endgame: Bhushan Power CoC to pick winning bid today

The committee of creditors (CoC) of Bhushan Power and Steel are scheduled to meet on Tuesday to select the most preferred bidder for the bankrupt company as the deadline for submitting revised quotes ended on Monday midnight. The three companies in the fray are Tata Steel, JSW Steel and the UK-based Liberty House. Both Tata Steel and JSW Steel on Monday declined to comment on whether they had submitted their revised bids or not till the time of going to the press.

On August 10, the Supreme Court had on a petition of Tata Steel refused to stay the the National Company Law Appellate Tribunal’s (NCLAT) order that had allowed submission of revised bids. The apex court had directed the NCLAT to “hear and pass final orders as expeditiously as possible” and also asked the lawyers not to seek any adjournment on August 17, the day the appellate tribunal is slated to hear the case.

The request for submitting a revised bid was made by JSW Steel but contested by Tata Steel.

The NCLAT’s August 1 order had said that the CoC will consider and evaluate the revised bids and identify the highest bidder.

However, it added that it be put it in a sealed cover until the appellate tribunal passes an order on the original petition of Tata Steel which is whether the late bid submission by Liberty House initially should be seen valid or not.

The case of Bhushan Steel and Power has gone through several twists and turns in the last few months. On July 20 NCLAT had directed the CoC to convene its meeting and consider all the three bids and decide the H1 and H2 bidders and submit the proposal to the National Company Law Tribunal (NCLT) for adjudication.

However, it had added that while the NCLT may decide which is the better bid — H1 or H2 — based on the recommendation of the CoC, it will not disclose it till the appellate tribunal decides on the eligibility of Liberty House.

When the CoC subsequently met on July 27 as part of this direction, JSW Steel expressed its desire to revise its bid. The CoC allowed it, which was objected to by Tata Steel, which moved the NCLAT challenging this. Meanwhile, at the CoC’s meeting on July 31, the lenders chose Tata Steel’s bids as the most preferred one. However, with the NCLAT’s August 1 order calling for fresh bids, the CoC’s decision got superseded.

The race for the bankrupt company had taken a turn on April 23 when the NCLT had asked its lenders led by Punjab National Bank to consider the late bid submitted by UK-based Liberty House.

Liberty House had on February 26 challenged the rejection of its bid by the resolution professional (RP) on the grounds that it had been submitted late. The two bidders to submit their bids within the February 8 deadline were Tata Steel and JSW Steel.

On May 8, Tata Steel had challenged the NCLT’s order on the consideration of Liberty’s bid in the appellate tribunal.

Tata Steel had reportedly offered to make an upfront payment of Rs 17,000 crore to the lenders, way better than JSW Steel’s offer of an upfront payment of Rs 11,000 crore. According to sources, Liberty House has offered to pay bankers Rs 18,500 crore upfront, though this could not be confirmed.

Bhushan Power and Steel owed lenders close to Rs 47,000 crore as on March 31, 2017.

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First published on: 14-08-2018 at 04:50 IST
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