Power sector: Stressed assets – Small lenders to submit report by Oct 10
Small lenders to stressed power generation assets have been asked to furnish their resolution plans before October 10 to a group of bankers which met on Thursday to discuss the issue. The development came after the Supreme Court had halted the insolvency and bankruptcy process through its September 11 decision, providing a temporary respite to 34 stressed coal-based projects with a combined capacity of about 39 GW and banks’ exposure of Rs 1.75 lakh crore. Sources said all the lenders would meet after October 10 to assess the situation.
NCLAT wrongly allowed ArcelorMittal to pay dues after bidding for Essar Steel, NuMetal tells SC
Russia’s VTB Bank-promoted firm NuMetal has alleged in the Supreme Court that NCLAT “wrongly” applied legal provisions to enable its rival bidder ArcelorMittal to pay the dues of two debt-ridden firms even after it had bid for Essar Steel. A bench of Justices R F Nariman and Indu Malhotra has been hearing the cross appeals of NuMetal and steel and mining major ArcelorMittal against the order of the National Company Law Appellate Tribunal (NCLAT).
Walmart to shell out $800 million on Flipkart ESOP buyback
Walmart-backed Flipkart will offer its employees an opportunity to cash in on part of their stockholding in the company at $126-128 per share, according to an e-mail to staff. The e-mail, which follows the $16-billion deal by Walmart to buy a majority holding in the Indian e-commerce major, said eligible staff members will be allowed to liquidate part of their employee stock ownership plans (ESOPs) at $126-128 per unit. This would translate into a total sum of about $800 million (around 5,755 crore).
SBI gets tough with ArcelorMittal over Uttam Galva dues
A recent SBI communication to ArcelorMittal, questioning its locus standi to repay a $48-million loan availed by the steel giant’s erstwhile group entity, Uttam Galva, may become another stumbling block for the Lakshmi Mittal-owned company in its bid for stressed asset Essar Steel. ArcelorMittal, the world’s largest steel maker, is engaged in a pitched battled with Russia’s VTB Bank-promoted for the control of Essar Steel. In February, ArcelorMittal Netherlands had sold its entire 29 per cent stake in Uttam Galva to the Miglani family for Rs. 1 and agreed to pay back the loan facility availed by the latter to make itself eligible for Essar Steel.
IL&FS plans fire sale of financial services unit
Infrastructure Leasing and Financial Services Ltd (IL&FS) is planning to sell a majority stake in its financial services unit and additional assets worth 4,500 crore to pay down debts as the company rushes to meet its obligations and avoid bankruptcy. IL&FS has also asked the government to clear dues worth as much as 16,000 crore for work completed by the company, three executives familiar with the development said, requesting anonymity. Without clarity on whether the government will release payments, it’s critical for IL&FS to liquidate assets to avoid being dragged to a bankruptcy court. Disputes over contracts, delayed approvals for projects and rising interest rates have led to a cash crunch at the lender, resulting in IL&FS missing several repayment obligations.
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