New Delhi: India’s top court stopped ArcelorMittal from making a payment to lenders to buy Essar Steel India Ltd., extending billionaire Lakshmi Mittal’s wait to enter the South Asian country’s steel market.
The Supreme Court’s two-judge bench headed by Justice Rohinton F. Nariman said status quo is to be maintained regarding Arcelor’s plan to buy Essar Steel. The court directed the bankruptcy appellate tribunal to expeditiously decide on appeals in the case.
The order may delay Arcelor’s plans to purchase the steel mill, which can produce 10 million metric tons of the metal annually and make Arcelor the fourth-biggest player in a nation where the administration plans to invest trillions of rupees in infrastructure. The bankruptcy court had approved Arcelor and its partners Nippon Steel Corp.’s offer to pay $6 billion upfront to lenders and invest about another $1.1 billion in the company to turn it around.
A bankruptcy court overseeing the sale had asked a panel of lenders to consider higher payment to Standard Chartered, which said a substantial part of its Rs 3,500 crore ($505 million) dues would remain unpaid under Arcelor’s plan for the distribution of money among lenders. Still, the panel of lenders stuck with its earlier decision and the State Bank of India also challenged the direction in the top court.