Essar Steel auction: LN Mittal meets FM; Numetal promises turnaround plan

Stakes for Essar Steel have increased with both of its bidders - Numetal and ArcelorMittal  -  promising a well-planned resolution for the troubled steelmaker.

While Lakshmi Mittal, Chairman and CEO of ArcelorMittal, met Finance Minister Arun Jaitely, Numetal released a detailed statement on its intent for Essar Steel.

Numetal Ltd, the consortium led by Russia's VTB Bank and includes Rewant Ruia of the Ruia family,  said that it has submitted a detailed turnaround plan for the debt laden Essar Steel.

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The company in a statement said that the plan "address technological, operational and financial issues in both the short and long term."

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It added, "Numetal’s shareholders bring together a wealth of experience in technical and operational capabilities, banking and finance, commodity and regional expertise..."

 

While Russia's VTB Bank holds 40 per cent stake in Numetal, Indo International Trading and Aurora Enterprises hold 25 per cent each. Tyazhpromexport (TPE), a leading Russian engineering firm, holds  rest of the 10 per cent.

VTB is claimed to be among the largest emerging banking groups with assets worth $215 billion. TPE, on the other hand, has played an instrumental role in setting up of most of India's public sector-owned steel plants, including Bokaro and Bhilai based facilities of Steel Authority of India.

Indo International Trading is linked to the Somani Group, which is owned by the Kanpur-based family by the same name. The Somani Group is at present headed by Tarun Somani.

"In order to ensure a smooth transition and provide a catalyst for change in operational  management at Essar Steel, Numetal has assembled a team of senior professionals with significant experience and background," the company said. The professionals include CS Verma, the former Chairman of SAIL. Verma is the CEO of Numetal.

 

Mittal's charge

Meanwhile Lakshmi Mittal, Chairman and CEO of ArcelorMittal, met Finance Minister Arun Jaitley. 「We have put in a well-planned bid for Essar Steel. I think we can that we can create value in Essar Steel,」 he told reporters after meeting the minister.

He also said that neither of the bids - ArcelorMittal's or Numetal's - has been rejected by the resolution professional overseeing the auction of Essar Steel.

 

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