World’s Largest Steel Maker ArcelorMittal to Buy Out Essar Steel

ArcelorMittal said that it has been chosen by lenders to take over Essar Steel India Ltd for about Rs 42,000 crore

The Committee of Creditors has issued ArcelorMittal and its partner Japan’s Nippon Steel & Sumitomo Metal Corp a Letter of Intent (LoI) declaring them as the “successful applicant”.

(Photo: Reuters)

The world's largest steel maker ArcelorMittal on Friday, 26 October, said that it has been chosen by the lenders to take over the debt-laden Essar Steel India Ltd for about Rs 42,000 crore, news agency PTI reported.

ArcelorMittal said in a statement that its resolution plan for Essar Steel, which the lenders auctioned to recover over Rs 49,000 crore of unpaid loans, includes "an upfront payment of Rs 42,000 crore" to settle debt and "a further Rs 8,000 crore of capital injection into the company to support operational improvement, increase production levels and deliver enhanced levels of profitability".

The Committee of Creditors has issued ArcelorMittal and its partner Japan’s Nippon Steel & Sumitomo Metal Corp a Letter of Intent (LoI) declaring them as the “successful applicant”.

The development comes a day after promoters of Essar Steel offered to pay lenders Rs 54,389 crore, including Rs 47,507 crore upfront cash payment to clear all dues of lenders, and pull out the firm from insolvency proceedings.